Rishi Sunak considers topping-up wages when furlough ends with German-style scheme

and the claim The Treasury is considering new alternatives where wages are subsidised.

Although no decisions have been taken, one option on the table is that the Treasury and businesses share the cost of topping up wages of staff who can only be employed part-time due to the pandemic.

The Treasury is reportedly looking at whether it can subsidise the wages of employees who can work at least 50% to 60% of their normal hours.

The plan to subsidise wages would be similar to a wage subsidy scheme in Germany, where the government pays at least 60% of wages for the time an employee isn't working.

Employers then pay staff for the rest of their usual hours if they are worked.

The plans are similar to proposals made earlier this month by the Trades Union Congress (TUC), which helped Mr Sunak draft the original furlough scheme in March.

Other options also include a target extension for firms who could survive the crisis with additional support, as suggested by the Commons Treasury committee.

The Chancellor has been urged to extend the scheme or provide support to specific sectors badly affected by the pandemic.

It has been estimated that the end of the scheme will make 1.2million Brits unemployed, according to economic think tank NIESR.

Last week the Chancellor hinted that a new package of support could be on the cards.

At the time, the Chancellor vowed to be "creative" to find ways of helping people, and added that keeping people out of work isn't the answer.

Mr Sunak will update MPs on plans "to continue protecting jobs" on Thursday.

He said: "As our response to coronavirus adapts, tomorrow afternoon I will update the House of Commons on our plans to continue protecting jobs through the winter."

Boris Johnson also reiterated the earlier comments during Prime Minister's Questions today by saying the government will replace furlough with "creative and imaginative schemes".

He added: "I don’t think it would sensible to extend the current furlough scheme in its current form at the end of October, but we will do everything we can to support businesses, those in jobs and the self employed."

Yesterday, the Bank of England governor Andrew Bailey said that it's time to "stop and rethink" the furlough scheme ending for all, in favour of a targeted approach.

One industry source told The Guardian the Treasury is racing to announce a new support package before the start of October, when businesses are likely to start cutting jobs ahead of the end of the furlough scheme.

Employers planning to make fewer than 100 redundancies must run a 30-day consultation, meaning October 1 is the last point they could start this process if they intend on dismissing staff when furlough ends.

Companies can still make staff redundant after this date, but they'll have to pay full wages from November 1 onwards.

A wave of job cuts have already taken place, with the travel, retail and hospitality industries among the hardest hit so far.

The Treasury declined to comment when contacted by The Sun.

When the coronavirus jobs retention scheme first launched, it paid 80% of wages of furloughed workers - up to £2,500 a month.

Under the changes to the scheme, furloughed workers could then be brought back part-time from July.

From August, employers had to chip in to pay for national insurance and pension contributions for furloughed staff.

As of September 1, the government's contribution fell to 70% of wages up to a cap of £2,187.50 a month.

And from October 1, the government's contribution will fall to 60% of wages before the scheme ends on October 31.