Covid-19: Sunak will unveil an emergency job plan

Chancellor Ishii Sunak will later unveil a plan aimed at further reducing unemployment as a strict Covid-19 ban is in place.

The new measures will replace the upcoming Furlo plan, which is due to expire next month.

In July, about fifty million workers still received some or all of their income from the scheme, many in the hospitality sector.

Pubs and restaurants have warned that they will be hit hard by the new restrictions.

From Thursday, hospitality venues in England will have to be closed at 22:00 BST, as the government tries to control the spread of coronavirus.

Scotland is introducing similar measures, with pubs and rest restaurants rents closing from 22:00 BST on Friday, while the ban in Wales is limited to stopping the sale of liquor from 22:00 on Thursday.

“A lot of businesses can’t survive and we’re seeing more and more people losing their jobs,” said Kate Nicole, chief executive of trade body UKHospitality.

At about 12:30 a.m. the government hopes to unveil plans to address the Chancellor’s plans, which will eliminate job losses.

• The Covid crisis forces the autumn budget to be canceled
• Can the UK adopt a German or French furlough scheme?

It is understood that Mr Sunak is considering various forms of wage subsidy and will announce further financial assistance.

It is believed that it is already looking at options, including pay-top plans, operating in France and Germany.

The Prime Minister said Mr Sunak was working on “creative and imaginative” solutions.

Although the Treasury has declined to comment, it does include the idea of ​​allowing companies to reduce employee time by hiring companies, paying a share of lost wages.

Mr Sunak also announced on Wednesday that the autumn budget would be canceled this year due to the epidemic.

Canceling the budget is a big deal, because that’s what the big picture shows: the government is still in a state of crisis, left to make tough medium-term decisions on tax increases, which would at least be reflected in the content. A budget red buck.

But the more we spend on jobs, the more support we get. As the Chancellor told me last week, that doesn’t mean the Furlo plan shouldn’t be expanded indefinitely, but that he’s thinking “constructively”.

Discussions with business groups and unions have centered around supporting employers with cash flow barriers to keeping business jobs. The initial purpose of the Furlo scheme was to support people’s wages, clearly for them to stay at home.

The new plan is likely to draw inspiration from continental Europe, by subsidizing “short-term” work, that is, wage-up assistance to workers who work fewer hours in emergencies.

The Furlo plan is regularly praised by the Prime Minister, and Neuu is undoubtedly one of the most expertly executed policy responses to the Covid crisis. Throw in the fact that the Tory “red wall” is more comfortable using state spending, and some Tory thinkers advocate a permanent plan of wage aid that takes place in Germany.

We also expect extensions of various loan guarantee schemes offered by the Treasury for weeks or months. Banks are already pushing for some of these loans. Now significant levels of the economy remain under the shadow of the epidemic and there are ongoing social sanctions to defeat it.

It’s hard to see how a full cost review could be done in four years. The Treasury cannot calculate the size of the pie to be cut. Having a one-year review like last year can also avoid some rusty internal politics on winners and losers.

So as infection rates rise, more costs and more jobs are supported, and bonds are likely to become stronger rather than looser, but in times of high and rising public borrowing, all of this doesn’t account for how much is paid.

Wind down furlough

Furlow is under pressure from the government to extend or change the plan, which will move next month.

The coronavirus job retention plan was introduced in March and paid 80% of the wages of workers laid off, a maximum of £ 2,500 a month.

Since then, the employer has been asked to contribute 10% of the wages of the people on the furlough plus their national insurance and pension.

Even obscure workers can now return to part-time work while the government pays for the remaining hours not worked.

During the Prime Minister’s weekly question on Wednesday, Boris Johnson was called upon to take swift action by MPs from all parties to make that business more severely affected by the new restrictions on economic and leisure activity.

Citing Whitebread’s announcement that there are plans to cut as many as 1,000 jobs in the UK, Labor leader Sir Keir Storm said the threat to employment was “not theoretical”.

He said the CBI, the TUC, the Federation Small Business, the British Chamber of Commerce and the Governor of the Bank of England had all called on the Prime Minister to stop and reconsider and not to withdraw the furlough.

In a televised response to the prime minister’s broadcast on Tuesday, Sir Carey called for a “Plan B” for the economy – “because it does not mean bringing in new sanctions at the same time as supporting jobs and businesses.”

What are the possible options?

• Kurzerbet, Germany: Employers cut workers’ hours and as a result the government gives them a percentage of the money they lose. It is a long-established plan, but has been improved during the epidemic. It can now run for 21 months and the percentage of loss pay paid by the government can now be as much as 0%.
• France’s “chômage partiel”: The French plan, known as “partial unemployment” or “partial activity”, is also a pre-date of coronavirus epidemics. Companies are allowed to reduce employee hours by up to 40% for three years. Employees still receive almost all normal salaries, with the government paying a percentage of the cost.
• CBI’s suggestion: Wages received from the government should be available if employees can work at least 50% of their normal hours. The pay firm will pay for the full hours worked, but the employee will pay for two-thirds of the lost hours, with the sharing of costs between the company and the treasury. The subsidy will last for one year.
• TUC suggestion: A more generous version of the above. Employees can work in small amounts of their normal hours and are still eligible, while they can guarantee 80% pay for lost hours, or 100% if they are on the minimum wage.