Governments and companies will keep the wages of workers who have not been able to return to work full time due to the coronavirus at the top.
The Jobs Support Scheme, which will replace the Farlow Scheme, will provide workers with three-quarters of their normal wages for six months.
The government aims to stem the decline in public transport after taking new measures to curb the rise in coronavirus cases.
Chancellor Ishii Sunak said it was part of a broader “winter economy plan”.
About 30 million workers – or 12% of the UK workforce – are currently on partial or full-time leave, according to official figures. The job retention project will end on October 31st.
Mr Sunak said the government would directly support the wages of working people and that frustrated businessmen would demand the option of hiring workers in less time instead of their unemployed.
He added that the new scheme would only support existing employment “as opposed to existing jobs only as the government continues to subsidize wages.
“The primary goal of our economic policy remains unchanged – to support people’s employment – but the way we have achieved it must evolve,” he said.
“I can’t save every business, I can’t save every job.”
The new scheme starts on November 1 and will cost an estimated 300 300 million a month.
Mr Sunak said similar schemes would be available for self-employment.
How will the Jobs Support Scheme work?
- Under the scheme, the government will provide salary allowance to employees who are working less than normal due to low demand.
- This will apply to employees who can work at least a third of their normal time
- Employers will pay employees for their work
- The government and employers will each cover one-third of the lost salary for employees until they can work.
- The grant will be in cash at 697.92 per month
- All small and medium sized businesses will be eligible for this scheme
- If their turnover decreases during the crisis, they will be eligible for bigger business
- It will be open to employers across the UK even if they have not previously used the Fallu scheme
- The project will run for six months starting in November
The Fallu scheme was a bridge to make a living through the crisis. But for the bridge to be effective, it needs to reach the other end of the gap.
The Chancellor’s Wage Subsidy Scheme is a continuation of that assistance – but in a different, less generous way. Since employers have to pay more than before, and employees have to work, this is only for those businesses and posts that are possible at
So some workers will close the gap: the government is keen that unstable employers will be encouraged to think about their next move.
And that means unemployment will continue to rise – although four million economists have previously feared. The cost of the Chancellor’s new plan will go into the billions, with the Treasury already facing a deficit of 3 20,320bn.
At one point, taxes may have to rise to help the plug but there is no mention today, as it may be some time before the economy is strong enough to accept it.
But now the bill facing the chancellor could be much smaller than the final cost of doing nothing.
Mr. Sunak further announced that all the traders who have taken loans through the government loan scheme will be given more time to repay their money.
A cut in VAT on hospitality and tourism companies will also be extended till March. The VAT cut from 20% to 5% effective July 15 – was due to expire on January 12 next year.
The chancellor said “small businesses that took out” bounce back “loans could use a new salary as the flexible payment system increased, meaning more than 10 years of repayment could be repaid instead of the original six-year term.
The long payday period also applies to small and medium-sized companies that have taken co-viruses under the disrupted ruption scheme.
Businesses will have more time to apply for these loans, as well as for coronavirus large business disruption loan projects and future funding. Application dates for various projects were due to end in October and November.
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