The Chancellor of the Exchequer, Rishi Sunak, has delivered a Budget Statement this afternoon and announced that protecting jobs is the highest priority as he set out the UK’s plan for managing the economic impact of COVID-19.
The Chancellor noted that over 700,000 people have entered unemployment since March 2020 with unemployment peaking at 6.5% (much lower than the expected peak of around 11%). However, given this is likely to only include those in more traditional employment relationships, the number could be much higher in reality if the impact on those in more precarious work and/or with uncertain employment statuses are taken into account.
The major announcement is that the current furlough scheme will continue until the end of September 2021 with the current rate of 80% of wages maintained. However, as businesses re-open, employers will be expected to contribute 10% towards these wages in July 2021 and 20% from August until the end of the scheme.
Assistance for the self-employed will also continue with the grants (in the sum of 80% of average profits) available for February – April and then May – September. As businesses begin to re-open in the summer, the Chancellor confirmed that those whose turnover has reduced by more than 30% would receive the most help (in the form of an 80% grant).
There will also be grants for the hospitality and retail industry, who have been acutely impacted by the pandemic and subsequent lockdown, with non-essential retail business entitled to up to £6,000 per premises and hospitality and leisure business up to £18,000.
Posted on Mar 3rd, 2021 by Anthony Heywood