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Coronavirus Job Retention Scheme

Question for Treasury

UIN 37539, tabled on 21 July 2021

To ask the Chancellor of the Exchequer, what assessment his Department has made of the effect of closing the Coronavirus Job Retention Scheme on the travel industry; and what assessment he has made of the potential merits of a sector-specific extension to that scheme for industries which will not have fully reopened by September.

Answered on

6 September 2021

In order to aid businesses and employees, at Budget 2021 the Government extended the Coronavirus Job Retention Scheme (CJRS) for a further five months from May until the end of September 2021, at which point the CJRS will close. Furloughed workers in the UK will continue to receive more generous support than those in many other countries, as the CJRS ensures employees receive 80 per cent of their current salary for hours not worked, up to £2,500 per month. As the economy reopened and demand returned, the Government asked employers to make a small additional contribution of 10 per cent towards the cost of paying for unworked hours, from July. As the economy reopens further, this employer contribution has increased to 20 per cent in August and September.

It is right to continue with the existing timetable to reintroduce employer contributions, in order to strike the right 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 as demand returns. At the end of June the number of jobs furloughed was as its lowest since the scheme began, at 1.9 million jobs furloughed. Almost three million jobs have moved off the furlough scheme since March as the economy began to bounce back and businesses reopened.

The Government recognises the challenging circumstances facing the travel sector as a result of COVID-19 and firms experiencing difficulties can draw upon the unprecedented package of measures announced by the Chancellor, including schemes to raise capital and flexibilities with tax bills. The aerospace sector and its aviation customers are being supported with over £11 billion made available through loan guarantees, support for exporters, the Bank of England’s Covid Corporate Financing Facility and grants for research and development.

Answered by

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