The UK Government must urgently reintroduce the furlough scheme so that Scotland can take protective measures against the omicron variant whilst protecting jobs, according to Scottish Greens MSP Lorna Slater.
The funding is needed to support workers and businesses already suffering due to a significant loss in trade and closures caused by local outbreaks, as well as allowing devolved governments to take public safety measures to stop the spread of the new strain of the virus.
Without economic support, the options available to the Scottish and Welsh governments and Northern Irish Executive are more limited.
Scottish Greens Lothian MSP Lorna Slater said:“The UK Government has taken an utterly chaotic approach to COVID, with confusing messages undermined by the Prime Minister himself failing to follow the rules. Omicron is spreading fast and the UK Government must recognise the clear risks to vulnerable people and act decisively.
“The festive period is already disrupted, with many people cancelling plans for gatherings, and hospitality businesses and communities across Lothian are struggling. People need to be supported.
“In Scotland we are taking the steps to reduce the impact of the virus. Now it’s time for the UK Government to act responsibly and do the right thing by reintroducing furlough where it is needed.”
“Self-employed people could be particularly impacted this Christmas, so it’s vital those who missed out last time are included in the scheme, and that sick pay is enhanced to make it easier for people to self-isolate.”
First Minister Nicola Sturgeon and representatives from Scotland’s trades unions led by STUC General Secretary Rozanne Foyer will meet later today (Thursday 12 August) to discuss key issues affecting workers as Scotland recovers from the coronavirus (COVID-19) pandemic.
Matters such as the need for the UK Government to extend the furlough scheme and reverse plans for damaging cuts to Universal Credit that will see households lose out on over £1,000 per year are on the agenda, as well as discussions on how to ensure workers’ needs are protected as Scotland’s economy undergoes transformation to net zero.
The Scottish Government has written to the UK Government on seven occasions to call for the £20-per-week uplift to Universal Credit to be made permanent and extended to legacy benefits.
Analysis from the Joseph Rowntree Foundation indicates that cutting Universal Credit at the end of September will pull 500,000 people across the UK, including 200,000 children, into poverty.
Speaking ahead of her biannual meeting with the STUC, First Minister Nicola Sturgeon said: “We are committed to a just transition to net zero, making sure we don’t leave individuals or communities behind – and we must ensure we incorporate the same fairness as we emerge from the pandemic to deliver greater, greener and fairer prosperity as the economy recovers.
“Partnership with unions is key to making sure that workers are represented as part of that process, therefore communication and collaboration between unions and Government is absolutely essential.
“How we emerge from the pandemic – and support workers and employers through that economic recovery – will not only be crucial to safeguarding the livelihoods of people hit hardest by the impacts of COVID, but will inform our work as we plan for a just transition to a net zero economy.
“As economic activity is restored, businesses and workers will still require support from the furlough schemes as they move through recovery. Our focus is on helping them to doing this.
“Not all of the levers are in our hands however, and clarity is urgently needed from the UK Government on whether it will reverse its plans for harmful welfare cuts, extend furlough, and protect jobs as restrictions ease and the economy recovers.
“If not we must see the detail on what support will be put in place to ensure those hit hardest by the economic impacts of COVID aren’t left out in the cold.”
STUC General Secretary Rozanne Foyer said: “We are meeting the First Minister at a critical moment. Our focus is on building a recovery from COVID that creates a more equitable Scotland with fair work as a driver of economic transformation and sustainable economic growth. To achieve this and to bring about a just transition we need to create well-paid, unionised, green jobs in the public and private sectors.
“Our priorities include public sector pay, transport and a future Scottish National Care Service and we look forward to raising these issues with the First Minister.
“We share the Scottish Government’s call for an extension of the furlough scheme, for the £20-per-week uplift to Universal Credit to be made permanent and for the devolution of further borrowing powers to drive a fair recovery.”
Yesterdaymarked the one-year anniversary of the furlough scheme being introduced. TUC’s ALEX COLLISON takes stock
The scheme, a big win for the union movement, guarantees that employees working for businesses that have been closed due to social restrictions, who may have otherwise lost their jobs, receive at least 80 per cent of their wages while they’re unable to work.
Numbers using the scheme
The furlough scheme has undoubtedly protected millions of jobs throughout the pandemic, making it one of the few big successes in the government’s response to the pandemic.
Between the scheme’s introduction and the middle of February 2021, 11.2 million jobs have been furloughed at some point, with 1.3 million employers making use of it.
Use of the furlough scheme peaked in early May 2020, when 8.9 million jobs were furloughed. 4.7 million jobs were still furloughed at the end of January 2021, the latest available day that HMRC figures cover. A business survey from the ONS provides more up-to-date information, showing that 19% of the private sector workforce was furloughed in early March. This has been the same since January, and suggests the number of people furloughed has likely stayed around the same since January.
The number of people furloughed in January 2021 is the highest it’s been since July.
As you’d expect given the sectors most impacted by social restrictions, use of the scheme has been much higher in some industries than others. At the end of January, 44% of all furloughed jobs are within two industries: accommodation and food services (24%) and wholesale and retail (20%).
This equates to 1.1 million jobs in accommodation and food, and 940,000 jobs in wholesale and retail.
While the arts and entertainment sector has less jobs furloughed (315,000), this constitutes a large percentage of its workforce. 55% of the workforce was furloughed at the end of January 2021. This is a similar rate to accommodation and food (56%).
Across all industries, the number of jobs furloughed at the end of January was 47% lower than it was when furlough was at its peak. But, again, this varies by industry.
Construction and manufacturing, for example, both had large numbers of jobs furloughed in May 2020. While there’s still a significant number of jobs furloughed in these industries, the number has fallen by around two-thirds. In contrast, the number of employments furloughed in accommodation and food and arts and entertainment has fallen by 30%.
And it’s worth noting where these jobs may have gone. HMRC data on the number of payrolled employees shows that accommodation and food and arts and entertainment saw the most job losses between April 2020 and January 2021.
It therefore seems likely that some workers in these industries are losing their jobs rather than returning from furlough.
The scheme hasn’t been perfect
While the furlough scheme has undoubtedly saved millions of jobs, it hasn’t been perfect. A key flaw of the scheme is that there’s no protection to ensure no one is paid below the minimum wage while furloughed. While employers can choose to top up the wages of furloughed workers, not all do.
Low-paid workers are more likely to not to have their pay topped up. Because of this, in April 2020, around the peak of the scheme, just over two million employees were not being paid the legal minimum.
This means that the household finances of many low-paid workers, already being paid an insufficient minimum wage, have been hit hard.
Young workers, part-time workers and workers in the hospitality sector have also been more likely to be affected. Shockingly, a third of all accommodation and food workers were not earning the legal minimum wage in April 2020.
As well as this, the government’s attempts to wind down the scheme have often proved premature. The number of jobs furloughed hit its lowest point on October 31st, when it dropped to 2.4 million. The scheme was due to end on this day, but was extended at the last minute.
The number of employments furloughed went up to 3.7 million on November 1st, and then increased further a few days later due to stricter lockdown measures being introduced. This uncertainty around the future of the furlough scheme seems to have led to unnecessary job losses.
And the government has struggled to reach those in non-conventional work, whether self-employed forced to operate through companies, zero-hours workers, and those mixing employment and self-employment.
The government introduced the Self Employment Income Support Scheme (SEISS) alongside the furlough scheme, but the two didn’t seamlessly interact to cover all workers, and the requirements of the scheme have meant that millions of workers have fallen between the cracks, unable to get support.
What next?
The government has committed to keeping the furlough scheme running until the end of September. The amount the government contributes to the wages of furloughed workers will begin to reduce before then, dropping to 70% in July and 60% in August and September.
The current roadmap out of lockdown provisionally plans for all areas of the economy to be up and running months before the end of furlough. However, the September end date creates a cliff edge, especially as it comes alongside the end of the Universal Credit uplift. The government must ensure it adapts the scheme to any changes of the roadmap. If business closures last longer than expected, so too should the scheme.
It’s also urgent that the government overhauls our broken social safety net so that it properly supports for those who need it. This includes raising both Universal Credit and legacy benefits to at least 80% of the national living wage (£260 per week), ending the five-week wait by converting advance payment loans to grants, and scrapping the two-child limit, benefits cap and no-recourse-to-public-funds rules.
Finally, it’s important that the government begins to look beyond the scheme. Investing now in good, well-paid jobs will help to replace any jobs lost when the scheme ends.
Fast tracking spending on projects such as broadband, green technology, transport and housing, for example, could deliver a 1.24 million jobs boost by 2022, and the TUC has set out plans to fill and create 600,000 jobs in the public sector.
Millions of British workers are putting themselves and others at risk of Covid-19 due to inadequate sick pay and pressure from their employers, new research shows.
The RSA (royal society for arts, manufactures and commerce) warns that a growing ‘economic security trap’ — the choice workers face between protecting their income and their health — is contributing significantly to the spread of the virus.
Polling carried out between 13 Jan and 15 Jan by Yonder (formerly Populus) of UK workers finds:
around one-in-25 (4%) British workers has worked within 10 days of a positive test, rising to one-in-ten (10%) of those in insecure work such as a zero-hours contract, agency work or the gig economy
6% of British workers have worked with Covid-19 symptoms, rising to 8% of insecure workers and 13% of the self-employed
12% have been ordered into work when they could have easily and more safely worked from home
only 16% think Statutory Sick Pay is sufficient to meet their needs.
The RSA calls for an emergency package to address economic insecurity, including:
Recent RSA research on key workers has found that many staff in key industries report struggling to take time off when unwell, including 29% of those working in social care.
The RSA has a long-running programme of research dedicated to tackling economic insecurity in the UK. Last year the organisation published A Blueprint for Good Work, putting forward practical solutions for providing good work after the pandemic.
Alan Lockey, head of RSA’s future work programme, said: “Our polling shows that millions feel forced to put themselves and others at risk of the virus because of insecure work, pressure from bosses, and the failings of our deeply inadequate welfare state.
“Rishi Sunak must close this ‘economic security trap’ — the terrible trade-off many workers face between their health and putting food on the table — by allowing self-isolating workers to access the furlough scheme, and retaining the £20 per week uplift in universal credit.
“We also need to see help for the millions currently excluded, through no fault of their own – and the self-employed in particular. An ’emergency basic income’ style scheme, using the current tax infrastructure, is the best way to help reach all this group and close the gaps which we believe are helping to increase the infection rate.”
The furlough scheme has been extended until the end of April 2021 with the government continuing to contribute 80% towards wages – giving businesses and employees across the UK certainty into the New Year, Chancellor Rishi Sunak announced yesterday.
certainty for millions of jobs and businesses as furlough scheme extended until the end of April 2021
businesses struggling will have now until the end of March to access government generous loan schemes
Chancellor also confirmed that the Budget will be on the 3 March and set out the next phase of the plan to tackle the virus and protect jobs
In a move to ensure firms can access the support they need through continuing economic disruption, Rishi Sunak also confirmed he would be extending the government-guaranteed Covid-19 business loan schemes until the end of March.
These changes come ahead of the Budget, which the Chancellor has confirmed will take place on 3 March 2021. This will deliver the next phase of the plan to tackle the virus and protect jobs, so the extensions to the business loan and furlough schemes enable businesses to plan with certainty and access support in the first few months of the New Year ahead of the further update on wider Covid-19 economic support.
So far, the Coronavirus Job Retention Scheme (CJRS) scheme has protected 9.6 million jobs across the UK with more than one million businesses accessing loans to help them through the crisis.
Chancellor of the Exchequer Rishi Sunak said: “Our package of support for businesses and workers continues to be one of the most generous and effective in the world – helping our economy to recover and protecting livelihoods across the country.
“We know the premium businesses place on certainty, so it is right that we enable businesses to plan ahead regardless of the path the virus takes, which is why we’re providing certainty and clarity by extending this support, as well as implementing our Plan for Jobs.”
Business Secretary, Alok Sharma, said: “While our loan schemes have provided a vital lifeline to millions of firms across the country, we know that business owners need additional certainty as we head into the New Year.
“Extending government-backed loan schemes will give companies right across the UK the finance they need to support, protect and create jobs as we build back better from the pandemic.”
The Chancellor said he would review the employer contribution element of the CJRS in January, but decided to bring this forward to allow businesses to plan ahead for the remainder of the winter and the New Year.
The government will continue to pay 80% of the salary of employees for hours not worked until the end of April. Employers will only be required to pay wages, National Insurance Contributions (NICS) and pensions for hours worked; and NICS and pensions for hours not worked.
The eligibility criteria for the UK-wide scheme will remain unchanged and these changes will continue to apply to all Devolved Administrations.
Extending the scheme until the end of April means businesses across the country will have certainty about what support will be available to them.
Businesses will also be given until the end of March to access the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Large Business Interruption Loan Scheme. These had been due to close at the end of January.
The schemes have already provided over £68 billion in guaranteed loans, and helped to keep afloat business in all sectors of the UK economy who have been impacted by coronavirus.
We are extending the schemes now, ahead of Christmas and further into the new year, to ensure that businesses can continue to access the support they need to grow and recover.
The government has already announced that more support will be available beyond March, through a successor loan scheme. More details of the scheme will be announced in due course, with the government providing a further update on wider Covid-19 economic support at the Budget on 3 March.
The furlough and loan schemes are part of the government’s wider plan to support, create and protect jobs through its Plan for Jobs. This includes the Kickstart Scheme, more investment in training and skills as well as the Self Employment Income Support Scheme grant, with a fourth grant being made available from February to April 2021.
Commenting on yesterday’s announcement by the Chancellor that the Job Retention Scheme will be extended until April, TUC General Secretary Frances O’Grady said: “Unions have been pushing hard for the job retention scheme to be extended. This decision will bring some much-needed certainty for workers and businesses.
“But the threat of mass unemployment has not gone away. The government must provide additional support for the industries hit hardest by this crisis – like retail and hospitality.
“And it must create the jobs we need by investing now in jobs in green infrastructure, transport and our public services.
“Fast-tracking spending on these areas will cut unemployment and help the UK recover more quickly from this pandemic. Ministers should take this opportunity to improve the scheme, with a minimum wage floor, clear support for training and better support for the self-employed.”
On the need to help workers who lose their jobs, Frances O’Grady added: “We can’t afford for this pandemic to scar people’s prospects the way recent crises have. Ministers must help those who lose their jobs get back on their feet by providing a permanent boost to universal credit’.
