Coronavirus: Salary subsidy scheme extended into June

Rishi SunakImage source, Getty Images
Image caption,
Chancellor Rishi Sunak said companies will now be able to apply for a government wage subsidy for their furloughed workers in June

The government pay scheme for workers who have downed tools but remain employed has been extended.

More than nine million workers are expected to be furloughed, or put on state-paid leave, under the government's job retention scheme .

Chancellor Rishi Sunak said on Friday the wage subsidy would be available for another month until the end of June.

Business groups and firms such as Swissport earlier warned if the scheme was not extended, more jobs would go.

The chancellor said the salary scheme would be extended again "if necessary".

"With the extension of the coronavirus lockdown measures yesterday, it is the right decision to extend the furlough scheme for a month to the end of June to provide clarity," Mr Sunak said.

"It is vital for people's livelihoods that the UK economy gets up and running again when it is safe to do so, and I will continue to review the scheme so it is supporting our recovery."

How the scheme works

Under the Coronavirus Job Retention Scheme, the government will cover 80% of workers' wages for March, April and May if they are put on leave.

Employers will pay workers and reclaim the money from HM Revenue and Customs (HMRC) at the end of April. They can apply to join the scheme from Monday.

Figures from the British Chambers of Commerce (BCC) suggest nearly a fifth of smaller firms and half of companies will access the help.

Image source, EPA
Image caption,
CBI director general Carolyn Fairbairn earlier warned that more redundancies would occur if the policy was not extended

'Protecting jobs'

The Confederation for British Industry (CBI) welcomed the salary subsidy extension after repeatedly warning that many firms could start to cut staff without one.

"This extension means that firms will no longer be forced to issue redundancy notices over the next few to days to comply with 45-day consultation requirements, and can instead return to focusing on protecting jobs and their businesses," said CBI boss Dame Carolyn Fairbairn.

"It's absolutely clear that these vital support systems must stay in place until it's safe for people to return to work and we can begin to restart and revive our economy."

Chief executive of the Airport Operators Association Karen Dee said: "Airports are making significant use of the job retention scheme, which has helped to address some of the challenges they are currently facing, so it is good news that the Chancellor has decided to extend it".