To ask Her Majesty's Government what assessment they have made of the number of small businesses that will be unable to retain current staff numbers after the Coronavirus Job Retention Scheme ends; and what steps they are taking to financially support small businesses after September 2021.
22 June 2021
Throughout this pandemic, our Plan For Jobs has supported jobs and businesses with over £400 billion of economic support – one of the most generous and comprehensive packages in the world.
At the Budget, the Chancellor announced a generous extension of economic support to reflect the easing of restrictions and enable the private sector to bounce back as quickly as possible. As the Chancellor put it in his Budget speech: “we’re going long, extending our support well beyond the end of the Roadmap to accommodate even the most cautious view about the time it might take to exit the restrictions”.
Eligible businesses and employees across the United Kingdom are benefitting from the extension of the CJRS until the end of September, with employees receiving 80% of their salary for hours not worked, up to £2500 per month. From July, employers will contribute 10% of costs of unworked hours, followed by 20% in August and 20% in September. Many other countries have already done the same (Denmark, Netherlands, France, Spain), and economy-wide schemes have ended in Australia and New Zealand. Furthermore, the economy now is in a stronger position than it was last autumn, when businesses also contributed up to 20 per cent of wage costs. And lastly, the labour market is in a stronger position, with 5.5 million fewer people on furlough than in April 2020 and hiring intentions and job vacancy levels in June around 29 per cent above February 2020 levels.
As restrictions have been lifted, it is right that we ask employers to contribute more to strike the balance between supporting the economy as it opens up, continuing to provide support and protect incomes, and ensuring incentives are in place to get people back to work.
The delay of Step 4 is accommodated by the continuation of the Government’s package of economic support for businesses, which can continue to benefit from extensions to the furlough scheme; a UK-wide recovery loan scheme; business rates relief; enhanced Time to Pay for taxes; and support for paying deferred VAT.