Chancellor Rishi Sunak has announced the Government's Furlough Scheme will be extended until the end of March.

  • The Coronavirus Job Retention Scheme is being extended until 31 March 2021.
  • 30 November 2020 is the last day employers can submit or change claims for periods ending on or before 31 October 2020.
  • Claims for furlough days in November 2020 must be submitted by 14 December 2020.

The self-employment support scheme has also been extended.

Businesses and people across the UK given certainty over winter months with further support announced by Chancellor Rishi Sunak

The furlough scheme will now be extended until the end of March – protecting millions of jobs across all nations

The next self-employed income support grant will also increase from 55% to 80% of average profits - up to £7,500

To reflect the recent changes to the #furlough scheme, the UK-wide Self-Employment Income Support Scheme (#SEISS) will be made more generous – with self-employed individuals receiving 80% of their average trading profits for November. 

@RishiSunak tweeted:

To give people across the UK certainty over the winter, I can announce today that the furlough scheme will not be extended for one month – it will be extended until the end of March. Employees will receive 80% of their usual salary for hours not worked, up to £2,500 a month.

We're increasing the support to the self-employed from 40% of trading profits to 80% for November.

SEISS is calculated over 3 months so this increases the total grant from 40% to 55% of trading profits for November to January and the max grant increases to £5,160.

Grants will also be paid faster than previously planned with the claims window opening at the end of November rather than the middle of December.

The increase means £4.5bn of support for the self-employed between November and January.

Sector Response

Neil Carberry100x100Neil Carberry, Chief Executive of the Recruitment and Employment Confederation, said:

“Businesses want support that is stable across the crisis, rather than changing week-to-week. So the extension of the furlough scheme to the end of March is a good move.

“But there is more to do. The fight against the virus is being compromised by the failure to fund Statutory Sick Pay for every worker if they need to self-isolate. The vast majority of businesses supplying temporary workers, who are vital to sectors like education, logistics and care, are ineligible for SSP support - and a stand-off over who pays could lead to greater economic damage, as work gets shelved.

“We need to keep hiring demand as high as we can. Lowering the cost of labour by reducing employers National Insurance contributions, the biggest business tax, is one measure which will help."

Dave Innes 100x100Dave Innes, Head of Economics at the independent Joseph Rowntree Foundation (JRF) said:

“The Chancellor is right to acknowledge that the health crisis and its economic impacts are likely to last well into the next few months, by giving businesses the certainty they need to plan and to keep as many people as possible in their jobs.

"The Chancellor did not take this opportunity to extend that certainty and reassurance to the 16 million people in families receiving Universal Credit or Working Tax Credit, who face a £20 drop in their weekly income next April. The Government must confirm that this vital lifeline will stay in place and be extended to people receiving legacy benefits. We also didn't hear that the eviction ban will be extended. This was a vital protection for renters during the first lockdown, and without it we could see a wave of evictions and increased homelessness.

“The Chancellor did not indicate that people unable to work at points this winter because of caring responsibilities, or a return to shielding, are covered by the furlough scheme’s extension. No one should have to choose between income and health, and the Chancellor should confirm that these groups will get the support they need."

Workers across the United Kingdom will benefit from increased support with a five-month extension of the furlough scheme into Spring 2021, the Chancellor announced today. 

The Coronavirus Job Retention Scheme (CJRS) will now run until the end of March with employees receiving 80% of their current salary for hours not worked.

Similarly, support for millions more workers through the Self-Employment Income Support Scheme (SEISS) will be increased, with the third grant covering November to January calculated at 80% of average trading profits, up to a maximum of £7,500.

Paul Holcroft 100x100Paul Holcroft, Managing Director at Croner, said:

"A week is undoubtedly a long time in coronavirus Britain. Seven days ago, employers were preparing to implement the new Job Support Scheme, safe in the knowledge that the furlough scheme was not going to be extended despite substantial calls for it to be so.

"However, this all changed on Saturday, with the government finally confirming it’s extension until the end of December. Today, it has gone further still, extending it to the end of March. By that point, it will have run for over a year, something that seemed unprecedented only a few days ago.

"Employers will no doubt breathe a significant sigh of relief at this news, with the extended scheme hopefully providing them with a life-line they desperately need as we head into the winter months and beyond. Unlike the situation only last month, the government will continue to provide the full 80% of employee wages until at least January, where it will be reviewed if employers will be asked to provide more. This means that, if an employer chooses to place employees on full furlough, they will only need to provide pay for national insurance and employer pension contributions.

"While we wait to hear if employer contributions to the scheme will change as we head into 2021, one thing is clear; the furlough scheme will be much more generous than the previously planned Job Support Scheme. For those employers who planned to use the new Job Support Scheme, it has been made clear that this scheme has been postponed indefinitely. Whether something of a similar nature to it will be announced come March does remain to be seen.

"Another central point made by the Chancellor today regarded the Job Retention Bonus, which was originally designed to incentivise employers to keep previously furloughed staff on once the scheme comes to an end. It has been confirmed that the Bonus as we expected it would no longer be available, and future incentive schemes will be announced in due course."

Mike Cherry, FSB Chair said: 

“We are pleased that the Chancellor has listened to calls to help both groups of members that FSB champions - small employers and the self-employed. At a time of unprecedented restrictions, this will help small employers and the self-employed to mitigate some of the economic damage.” 

Kate Nicholls, UK Hospitality CEO said: 

“The extension of furlough to the end of March will make a huge difference in helping to protect hospitality jobs across the whole of the UK. The announcement is a welcome demonstration that the Chancellor has continued to listen to the concerns of businesses in our sector, which was hit first and hit hardest by the pandemic. Hospitality is facing a tough winter so this enhanced support is crucial and will safeguard jobs and help businesses to plan for more certain future.” 

Rain Newton-Smith, CBI Chief Economist said: 

“The Chancellor has built a bridge for business to Spring 2021 and taken much needed steps to help firms across the UK survive this winter.   

“Extending the tried and trusted Job Retention Scheme will give companies the certainty and stability they need to help safeguard thousands of jobs into March.  Sectors and supply chains under the greatest strain may need more tailored support in the coming weeks.”  

Jonathan Geldart, IoD Director General said: 

“Extending furlough is the right call from the Chancellor. This will give directors much greater confidence about their ability to keep staff on board through the Winter.” 

Adam Marshall, BCC Director General said: 

“A further extension of the furlough scheme and more generous grants for the self-employed are important steps in protecting jobs and providing certainty for our business communities beyond the immediate shock of a four-week lockdown.”  

Emma McClarkin, British Beer & Pub Association Chief Executive said: 

“The Chancellor has listened to our concerns on the impact of coronavirus measures on the sector and delivered on some of the immediate support we need. 

“The extension of the full furlough scheme until March 2021 will give businesses some certainty on the support they need for the difficult months ahead. This will give some comfort to our staff and provide our businesses with a better chance to survive these unprecedented times.”

Michelle Ovens MBE, Founder of Small Business Britain said: 

“The ongoing crisis is presenting massive challenges for small businesses and they need as much support as possible. We are pleased to see the government extend the furlough scheme until March. This is much needed and will help small firms facing uncertainty over the winter and give them some reassurance to plan.” 

The Chancellor of the Exchequer Rishi Sunak said: 

“I’ve always said I would do whatever it takes to protect jobs and livelihoods across the UK - and that has meant adapting our support as the path of the virus has changed.

“It’s clear the economic effects are much longer lasting for businesses than the duration of any restrictions, which is why we have decided to go further with our support.

“Extending furlough and increasing our support for the self-employed will protect millions of jobs and give people and businesses the certainty they need over what will be a difficult winter.”

The Chancellor also announced today an increase in the upfront guarantee of funding for the devolved administrations from £14 billion to £16 billion. This uplift will continue to support workers, business and individuals in Scotland, Wales and Northern Ireland.

The furlough scheme was initially extended until December 2. But the government is now going further so that support can be put in place for long enough to help businesses recover and get back on their feet – as well as giving them the certainty they need in coming months. Evidence from the first lockdown showed that the economic effects are much longer lasting for businesses than the duration of restrictions. 

There are currently no employer contribution to wages for hours not worked. Employers will only be asked to cover National Insurance and employer pension contributions for hours not worked. For an average claim, this accounts for just 5% of total employment costs or £70 per employee per month. The CJRS extension will be reviewed in January to examine whether the economic circumstances are improving enough for employers to be asked to increase contributions.

Throughout the pandemic, the government has acted with speed to protect lives and safeguard jobs with an unprecedented £200 billion support package. The furlough scheme has protected over nine million jobs across the UK, and self-employed people have already received over £13 billion in support. This is in addition to billions of pounds in tax deferrals and grants for businesses. 

On top of this, the government has announced:

  • Cash grants of up to £3,000 per month for businesses which are closed worth more than £1 billion every month
  • £1.1 billion is being given to Local Authorities, distributed on the basis of £20 per head, for one-off payments to enable them to support businesses more broadly
  • Plans to extend existing government-backed loan schemes and the Future Fund to the end of January, and an ability to top-up Bounce Back Loans
  • An extension to the mortgage payment holiday for homeowners
  • Up to £500 million of funding for councils to support the local public health response.

This is just one element of the comprehensive package of support the government has set out for businesses, including more than £65 billion in government-backed loans, which have now been extended until 31st January, deferral of VAT payments, business rates holidays, generous grants for hospitality, leisure and retail businesses, a moratorium on eviction for commercial tenants and the Statutory Sick Pay Rebate Scheme.  

In addition, the Jobs Retention Bonus (JRB) will not be paid in February and the government will redeploy a retention incentive at the appropriate time. The purpose of the JRB was to encourage employers to keep people in work until the end of January. However, as the CJRS is being extended to the end of March 2021, the policy intent of the JRB falls away.  

Support for Devolved Administrations

In July, the UK Government announced an unprecedented upfront guarantee of resource funding for the devolved administrations. This has meant the devolved administrations have funding certainty ahead of UK Government making announcements.

Today the UK Government is continuing to provide that upfront certainty by giving the Devolved Administrations an additional £2 billion as part of the guarantee, to at least £16 billion this year above the funding outlined in the Spring Budget 2020.

This is based on the central forecast for UK Government expenditure in 2020-21 and means an extra £1 billion for the Scottish Government, £600 million for the Welsh Government and £400 million for the Northern Ireland Executive.

Today’s announcement means a total increase of at least £8.2 billion of additional funding for the Scottish Government, £5.0 billion for the Welsh Government and £2.8 billion for the Northern Ireland Executive, on top of their Spring Budget 2020 funding.

Scotland 

  • We have given the Scottish Government an additional £8.2 billion to cope with the pressures of the pandemic and we are protecting more than 123,000 jobs in Scotland through the furlough scheme, down from a peak of more than 930,000 in June.  
  • More than 76,000 loans worth more than £2.1 billion have been offered under the Bounce Back Loans Scheme 
  • More than 3,300 loans worth £758 million have been offered under the Coronavirus Business Interruption Loan Scheme 
  • 126,000 people in Scotland have benefitted from the Self Employment Income Support Scheme. 

Wales 

  •  We have given the Welsh Government an additional £5 billion to cope with the pressures of the pandemic and we are protecting more than 68,000 jobs in Wales through our furlough scheme, down from a peak of 378,400 in June.  
  • More than 48,000 loans worth more than £1.3 billion have been offered under the Bounce Back Loans Scheme 
  • More than 1,600 loans worth £373 million have been offered under the Coronavirus Business Interruption Loan Scheme. 
  • 82,000 people in Wales have benefitted from the Self Employment Income Support Scheme. 

Northern Ireland 

  • We have given the Northern Ireland Executive an additional £2.8 billion to cope with the pressures of the pandemic and we are protecting more than 35,000 jobs in Northern Ireland through our furlough scheme, down from a peak of more than 240,000 in June.  
  • More than 33,000 loans worth more than £1 billion have been offered under the Bounce Back Loans Scheme 
  • More than 1,000 loans worth £333 million have been offered under the Coronavirus Business Interruption Loan Scheme 
  • 56,000 people in Northern Ireland have benefitted from the Self Employment Income Support Scheme.

Government increases support for self-employed across the UK

The government is increasing its support to the self-employed over the coming months and ensuring people get paid faster than previously planned, it was announced on 2 November.

To reflect the recent changes to the furlough scheme, the UK-wide Self-Employment Income Support Scheme (SEISS) will be made more generous – with self-employed individuals receiving 80% of their average trading profits for November.

And to ensure those who need support get it as soon as possible, payments will also be made more quickly with the claims window being brought forward from 14 December to 30 November.

The changes will ensure that self-employed individuals who temporarily cannot carry out their business or have suffered reduced demand due to the outbreak are supported over winter.

In addition, more businesses will be able to access additional support as deadlines for applications for government-backed loan schemes and the Future Fund have been further extended until 31 January 2021.

Chancellor of the Exchequer Rishi Sunak said:

So far we’ve provided £13.7 billion of support to self-employed people through the crisis - and I’ve always said we will continue to do everything we can to support livelihoods across the UK.

The rapidly changing health picture has meant we have had to act in order to protect people’s lives and I know this is incredibly worrying time for the self-employed. That is why we have increased the generosity of the third grant, ensuring those who cannot trade or are facing decreased demand are able to get through the months ahead.

Business Secretary Alok Sharma said:

We know what an incredibly difficult time it has been for self-employed workers across the country. We are determined to support them.

Today’s measures will mean people will receive more money in their back pockets, faster, to help them through the winter months ahead.

As SEISS grants are calculated over three months, the uplift for November to 80 per cent, along with the 40 per cent level of trading profits for December and January, increases the total level of the third grant to 55 per cent of trading profits. The maximum grant will increase to £5,160.

This provides broadly equivalent support to the self-employed as we are providing to employees through the government contribution in the Coronavirus Job Retention Scheme in November and then the Job Support Scheme in the two subsequent months.

So far, the government has provided £13.7 billion of support to self-employed people through the crisis, with the world-leading scheme among the most generous in the world.

In September, the Chancellor announced an extension of the SEISS to provide support throughout the Winter period, with two grants to cover the period until April.

The SEISS continues to be just one element of a comprehensive package of support for the self-employed. In addition to this they can also access other elements of the package which includes Bounce Back Loans, tax deferrals, rental support, mortgage holidays, and other business support grants.

These government backed loan schemes have already supported more than 1 million businesses to access over £60 billion of finance.

To be eligible for the Grant Extension self-employed individuals, including members of partnerships, must:

  • have been previously eligible for the Self-Employment Income Support Scheme first and second grant (although they do not have to have claimed the previous grants)
  • declare that they intend to continue to trade and either:
    • are currently actively trading but are impacted by reduced demand due to coronavirus
    • were previously trading but are temporarily unable to do so due to coronavirus

This follows the CJRS being extended until December. This provides broadly equivalent support to the self-employed as is being provided to employees through the government contribution in the Coronavirus Job Retention Scheme in November and then the Job Support Scheme in the two subsequent months.


Furlough Scheme Extended and Further Economic Support Announced

People and businesses across the UK are being provided with additional financial support as part of the government’s plan for the next phase of its response to the coronavirus outbreak, the Prime Minister announced on Saturday (31 October).

Throughout the crisis the government’s priority has been to protect lives and livelihoods. The Prime Minister said the government’s Coronavirus Job Retention Scheme - also known as the Furlough scheme - will remain open until December, with employees receiving 80% of their current salary for hours not worked, up to a maximum of £2,500. Under the extended scheme, the cost for employers of retaining workers will be reduced compared to the current scheme, which ends today. This means the extended furlough scheme is more generous for employers than it was in October. 

In addition, business premises forced to close in England are to receive grants worth up to £3,000 per month under the Local Restrictions Support Grant. Also, £1.1bn is being given to Local Authorities, distributed on the basis of £20 per head, for one-off payments to enable them to support businesses more broadly.

Rishi Sunak 100x100Chancellor Rishi Sunak said:

“Over the past eight months of this crisis we have helped millions of people to continue to provide for their families. But now - along with many other countries around the world - we face a tough winter ahead.

“I have always said that we will do whatever it takes as the situation evolves. Now, as restrictions get tougher, we are taking steps to provide further financial support to protect jobs and businesses. These changes will provide a vital safety net for people across the UK.”

Job Retention Scheme

Employers small or large, charitable or non-profit, are eligible for the extended Job Retention Scheme, which will continue for a further month.

Businesses will have flexibility to bring furloughed employees back to work on a part-time basis or furlough them full-time, and will only be asked to cover National Insurance and employer pension contributions which, for the average claim, accounts for just 5% of total employment costs.

The Job Support Scheme, which was scheduled to come in on Sunday 1st November, has been postponed until the furlough scheme ends.

Additional guidance will be set out shortly.

Mortgage Holidays

Mortgage payment holidays will no longer end today. Borrowers who have been impacted by coronavirus and have not yet had a mortgage payment holiday will be entitled to a six month holiday, and those that have already started a mortgage payment holiday will be able to top up to six months without this being recorded on their credit file.

The FCA will announce further information on Monday.

Business Grants

Businesses required to close in England due to local or national restrictions will be eligible for the following:

  • For properties with a rateable value of £15k or under, grants to be £1,334 per month, or £667 per two weeks;
  • For properties with a rateable value of between £15k-£51k grants to be £2000 per month, or £1000 per two weeks;
  • For properties with a rateable value of £51k or over grants to be £3000 per month, or £1500 per two weeks.

These announcements are only part of the government’s world-leading economic response to coronavirus – the largest package of emergency support in post-war history – to protect, create and support jobs.

The furlough scheme protected over nine million jobs across the UK, and self-employed people have received over £13 billion in support. This is in addition to billions of pounds in tax deferrals and grants for businesses.

Job Support Scheme launch delayed as Furlough Scheme is extended

The government’s JSS was due to be available to businesses across the UK from 1 Nov.

Chancellor of the Exchequer, Rishi Sunak, said:

“I’m pleased that the IMF this week called our response to the pandemic one of the best examples of coordinated action globally- the furlough scheme has been central to that, supporting 9.6 million jobs through some of the most challenging economic times.

“But it’s right that as we move towards a more targeted approach to tackle the virus, our support becomes more targeted too.

“The Jobs Support Scheme will continue to protect jobs throughout the difficult months ahead and is part of our comprehensive Plan for Jobs.”

The JSS scheme is designed to support businesses across the whole of the UK who are either legally required to close or facing lower demand over the winter months. Under the JSS Open part of the scheme, which was made more generous last week, the government contributes 62% towards the wages of staff for the hours they do not work, whilst the employers pay just 5% plus NICS and pensions contributions. Employees receive a minimum of 73% of their wages.  

Under JSS Closed, which is for businesses legally required to close due to coronavirus restrictions, the government will pay two thirds of each employees’ salary with employers just covering NICs and pension contributions, a very small proportion of overall employment costs.

Firms who retain staff that have previously been furloughed until the end of January will also receive a £1,000 per eligible employee payment under the JRB.

Taken together, the two schemes (JSSO and JRB) will cover 95% of the employment costs of the average previously furloughed employee until the end of January. For those earning less than £1,100 per month the JRB offsets all the employer costs of the JSS Open– meaning businesses will not have to make any contributions. Under the original CJRS around half of furloughed workers had earnings below this level.

For many lower earning employees on Universal Credit (UC), the combined impact of the support of the JSS and UC will mean they could receive around 90% of their normal net income (whilst working only 20% of the hours).

The CJRS was due to close ahead of the JSS launch on Sunday, but this has now been extended until Dec. As the scheme draws to a close new data published by HMRC shows that during the scheme’s eight month life it has protected 9.6m jobs through some of the most challenging economic times the country has ever faced - with 90% of those coming off furlough by August returning to the same job. 

The JSS and JRB are just one part of our generous package of measures, that includes the extended business grants and Self-Employed Income Support Schemes announced last week, which will continue to support businesses and livelihoods across the country over the winter months.

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