Updated: Dec 18, 2020
The furlough scheme has been extended until the end of April 2021 with the Government continuing to contribute 80% towards wages the Chancellor announced today, giving businesses and employees across the UK certainty into the New Year.
In a move to ensure firms can access the support they need through continuing economic disruption, Rishi Sunak also confirmed he would be extending the Government-guaranteed COVID-19 business loan schemes until the end of March.
These changes come ahead of the Budget, which the Chancellor has confirmed will take place on 3 March 2021.
The furlough and loan schemes are part of the Government’s wider plan to support, create and protect jobs through its 'Plan for Jobs'. This includes the Kickstart Scheme, more investment in training and skills, as well as the Self Employment Income Support Scheme (SEISS) grant which will see a fourth grant being made available for February to April 2021.
Chancellor of the Exchequer, Rishi Sunak, said: “Our package of support for businesses and workers continues to be one of the most generous and effective in the world – helping our economy to recover and protecting livelihoods across the country.
“We know the premium businesses place on certainty, so it is right that we enable businesses to plan ahead regardless of the path the virus takes, which is why we’re providing certainty and clarity by extending this support, as well as implementing our Plan for Jobs.”
Business Secretary, Alok Sharma, said: “While our loan schemes have provided a vital lifeline to millions of firms across the country, we know that business owners need additional certainty as we head into the New Year.
“Extending government-backed loan schemes will give companies right across the UK the finance they need to support, protect and create jobs as we build back better from the pandemic.”
The Chancellor said he would review the employer contribution element of the Coronavirus Job Retention Scheme (CJRS) in January, but decided to bring this forward to allow businesses to plan ahead for the remainder of the winter and the New Year.
Self-Employed workers will now be waiting with bated breath to hear the value of their fourth coronavirus support grant. Self-Employed workers have recently been able to claim for the third Self-Employed Income Support Scheme (SEISS) grant which opened on 30 November 2020 and closes on 29 January 2021.
Support for millions of workers through the third SEISS grant covers November to January and will be calculated at 80% of average trading profits, up to a maximum of £7,500.
The Chancellor is yet to announce the value of the fourth SEISS grant covering February to April.