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Government willing to extend furlough scheme 'beyond June', Cabinet minister reveals

Government willing to extend furlough scheme 'beyond June', Cabinet minister reveals

Brandon Lewis said the scheme could be extended

3 min read

The Government is willing to extend its furlough wage scheme "beyond June", according to a senior Cabinet minister.

Northern Ireland Secretary Brandon Lewis said there was no "final decision" on when to end the scheme, as he insisted ministers would do "whatever it would take" to protect the economy.

It comes amid speculation Chancellor Rishi Sunak was preparing to scale back the programme, which is currently set to finish on June 30.

Speaking on Monday Mr Sunak said the job retention scheme, which is currently subsidising the wages of 6.3m furloughed workers, was "unsustainable" but pledged there would not be a "cliff edge" end to the payments.

One of the options being considered by the Treasury is a reduction of the current subsidy to 60% of wages, with further smaller reductions to follow as the economy begins to restart, the Evening Standard has reported.

While another other option could see workers receiving a smaller subsidy from the Government if they return to work part-time.

But asked about the plans, Mr Lewis told the BBC Radio 4's Today programme: "We haven't made any final decisions on when it ends or how we will end it.

"People are talking about this because at the moment it is due for review and due to end at the end of June.

"But the Chancellor has been clear that if we need to extend furlough beyond the end of June then we will do that but we are going to do this in stages when we have a better understanding of where we are in terms of the cycle of the virus and the impact on the economy at that stage."

He added: "As the Chancellor and the Prime Minister said at the start of this, we'll do whatever we can, and whatever it takes to make sure...that when we come through this virus the economy has the ability to start to bounce back."

The hint came as former Chancellor Alastair Darling, who was at the Treasury during the financial crisis of the late 2000s, said the Government had not "got any alternative" than to keep running the scheme until the end of the year.

"We are living in extraordinary times," he told the Today programme. "As the Bank of England has said we haven't seen this sort of thing for maybe 300 years.

"It's much, much worse that the financial crisis of ten years ago.

"I think the Government has to be flexible about the furlough plan because if you're going to get people to go back to work I think it's highly unlikely they're all going to go back to work on day one."

He added: "We need to have flexibility so people can go onto short-time work, they can gradually be reintroduced to their jobs.

"I hope like many other people that many jobs come back and people go back to work.

"But I think we must plan on the basis that some jobs will not come back or at least they won't come back at anything like an acceptable rate and that means the Government has also got to announce a plan for jobs."

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