Coronavirus: businesses in Stamford, Rutland, Bourne and the Deepings must start paying towards furlough scheme from August
Businesses must start paying towards the furlough scheme from August, the Chancellor has announced.
Rishi Sunak said changes to the Coronavirus Job Retention Scheme will allow firms to bring back its staff on a part-time basis from July — a month earlier than previously stated — on the condition businesses contribute to salaries from August.
Mr Sunak added the furlough scheme would close to new applicants on June 30, with programmes of financial support not to be extended past October.
The Chancellor announced, however, that financial help would be extended for sole traders for an extra three months, with the grant available reduced by 10 per cent to 70 per cent of profits.
The move comes as lockdown measures were eased to allow the economy to safely reawaken as the country emerges out of the coronavirus crisis.
There are worries, however, that reduced government support for firms could result in a surge of redundancies as the economy falls into recession.
Mr Sunak said: "As we reopen the economy, there is broad consensus across the political and economic spectrum, the furlough scheme cannot continue indefinitely.
"Our top priority has always been to support people, protect jobs and businesses through this crisis.
"The furlough and self-employment schemes have been a lifeline for millions of people and businesses.
"We stood behind Britain's businesses and workers as we came into this crisis and we stand behind them as we come through the other side.
"Now, as we begin to reopen our country and kick-start our economy, these schemes will adjust to ensure those who are able to work can do so, while remaining amongst the most generous in the world."
Throughout June and July, the government will continue to pay 80 per cent of salaries, capped at £2,500, with businesses not required to pay anything.
The job retention scheme has helped cover the wages of 8.4 million staff unable to work during lockdown, at an expense of £15bn.