Today, Rishi Sunak announced his latest endeavour to try and stave off a major calamity over the winter months by trying to minimise job losses over these difficult times.
Whilst some may be hopeful about this initiative and that it will help many, others maybe thinking that this is just delaying the inevitable.
Nevertheless, whatever your viewpoint the key points are:
- Under the scheme, the government will subsidise the pay of employees who are working fewer than normal hours due to lower demand
- Workers must do at least a third of their normal hours
- Employers will pay staff for the hours they work
- The government and the employer will pay a third each for the hours they can’t work
- It means someone working a third of their hours would receive 77% of their pay
- The grant will be capped at £697.92 per month
- All small and medium sized businesses will be eligible for the scheme
- Larger business will be eligible if their turnover has fallen during the crisis
- It will be open to employers across the UK even if they have not previously used the furlough scheme
- The scheme will run for six months starting in November and replaces the “furlough” scheme
- It means the government will pay a maximum of 22% of someone’s wages, down from 80% at the start of the furlough policy
Bounce back loans
In addition, the chancellor also announced changes to loans taken out by any businesses. Instead of having 6 years to pay back loans, these can now be paid back over a 10 year period.
Helpful for cash flow for many struggling businesses.
The government continues its generosity.