What time is Rishi Sunak’s furlough announcement today?
CHANCELLOR Rishi Sunak is expected to make an announcement on the future of the furlough scheme on Tuesday, May 12.
It is believed the multi-billion pound scheme, which was set up to support workers during the coronavirus pandemic, is set to be rolled back.
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What time is Rishi Sunak's furlough announcement today?
Mr Sunak is expected to announce sweeping changes to the taxpayer-funded job retention scheme at 12.30pm in the House of Commons.
The Chancellor is listed on the Commons order paper as taking urgent questions on the Government's economic package in response to Covid-19.
He has been finalising details of tweaks to the project which is currently paying 6.5 million workers 80 per cent of their wages - up to a limit of £2,500 per month.
The scheme was due to expire this month after being announced in March.
It is currently costing the government up to £8billion.
Government sources had previously described a perceived need to "wean" the UK off the scheme to which it had become "addicted".
It comes as the UK begins to ease its way out of restrictions.
Prime Minister Boris Johnson unveiled a 50-page "blueprint" of how Britain is going to exit lockdown on Monday, May 11.
Immediate measures included encouraging some sectors to try and get back to work, a lifting of restrictions on outdoor exercise, and urging people to cover their faces on public transport and in shops.
The document set out a long term plan to try and get the country moving, with hopes to bring back primary schools in June - and potentially some shops in July.
All measures laid out in the document however were conditional on the continued decline of the virus.
Will the furlough scheme be extended?
Mr Sunak is expected to announce an extension to the bailout scheme that will confirm people can claim furlough pay until September.
He is expected to allow employers to furlough their staff part-time to help them ease themselves back to operation.
But he is also set to reduce the taxpayer-funded support down to 70 or even 60 per cent.
It is understood the details were still being finalised the night before the announcement as the Chancellor faces the tough task of telling millions their pay will be slashed.
The Chancellor will also use the announcement to attempt to slow the rate of people claiming Universal Credit.
Ministers revealed that the Government has now processed around two million Universal Credit claims since mid-March, when the lockdown was imposed.
Mr Johnson all-but confirmed that the scheme would be continued in some form beyond June when speaking in the House of Commons on May 11.
He told MPs: “It has been one of the most assailant, the most important feature of this country’s response so far to this crisis - that we have looked after some of the lowest paid in our society, the hardest working people and we will continue to do so.”
The PM also promised most people in the hardest hit industries will get their jobs back – in defiance of dire predictions of mass job losses.
He insisted working class people were “our priority” but admitted the country would “have to think about our economy differently as we go forward”.
Mr Johnson said confidently the hardest hit industries - such as leisure and hospitality - will "recover" from the pandemic.
What is the government's job retention scheme and how does it work?
Currently, furloughed workers are paid 80 per cent of their wages, up to £2,500 a month, by the government.
Furloughed workers are those who are unable to work due to the coronavirus pandemic because their places of work have been forced to close or cut back on staff.
The emergency measures mean that any UK employer can apply for the scheme, including business, charities, recruitment agencies and public authorities.
To be eligible for the scheme you must have created and started a PAYE payroll scheme on or before March 19, 2020, have , and have a UK bank account.
To access the scheme, your employer must comply with the following:
- Designate employees who cannot do their jobs due to the coronavirus measures put in place by the Government
- Notify those employees of their new "furloughed" status
- Submit information to HMRC about furloughed employees to set up a system for reimbursement and existing systems that will facilitate payments.
It is up to employers whether they pay salaries on time or wait for the furlough scheme to pay out.
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The furlough payments can be slightly different, depending on whether you have the same income on a regular basis or it differs.
If your pay varies, including salaried and PAYE employees, then it is worked out depending on which is higher from the following, either 80 per cent of the same month's earnings from the previous year, or 80 per cent of average monthly earnings from 2019-20 tax year.
If the worker has been employed for less than a year, the employer can claim for 80 per cent of their average monthly earnings since they started.