I am cautiously optimistic about the government’s Winter Economic Plan, announced last week, which will mean the government is able to reduce its huge expenditure without there being a cliff edge situation for the UK workforce.
The Job Support Scheme will run for six months from the 1st of November, replacing the furlough scheme.
Employees must work at least one third of their normal hours, with the government and employer each paying one third of their remaining wages.
The scheme will apply to businesses that need it like small and medium-sized companies, while big companies will be eligible if their turnover has tumbled by a third.
Chancellor Rishi Sunak (pictured) said: “The primary goal of our economic policy remains unchanged – to support people’s jobs – but the way we achieve that must evolve.
“I cannot save every business, I cannot save every job.”
The Job Support Scheme will run in combination with the Job Retention Bonus, which will see the government pay businesses £1,000 for every furloughed employee who comes back to work at least until the end of January.
While this seems a promising incentive, it does beg the question of whether businesses will employ staff until January and then ditch some of them. I guess time will tell on that one.
One demographic I do have to worry about is sections of the self-employed, as the scheme will only cover 20% of average monthly profits, down from 80%.
Obviously landlords have been vocal about the struggles of relying on rental income if they have tenants that won’t pay, but the likes of musicians, comedians and other artists are surely also feeling the strain.
The Chancellor also extended the time companies can access its various business loans until 30th November.
Meanwhile there’s more lenience for those who have already taken out business loans, as Sunak said companies can pay back loans for as long as 10 years.
The government has a difficult line to tread when it comes to supporting people, but slowly winding down the support measures rather than simply ending them seems a good move for the stability of individuals and the country.
Ryan Bembridge, Editor, PropertyWire
