New Covid furlough scheme shows Rishi Sunak is listening but devil will be in detail – Scotsman comment

Rishi Sunak’s announcement that the UK Government will pay two-thirds the wages of staff whose firms are forced to close by law as a result of the lockdown will be a relief for many but may also increase the sense of trepidation about the depth of this crisis.

Friday, 9th October 2020, 4:51 pm
Updated Saturday, 10th October 2020, 3:29 pm
Chancellor Rishi Sunak may have suddenly changed his mind about the level of help for businesses, but at least he's listening (Picture: Dominic Lipinski/PA Wire)
Chancellor Rishi Sunak may have suddenly changed his mind about the level of help for businesses, but at least he's listening (Picture: Dominic Lipinski/PA Wire)

Not long after announcing that the Jobs Support Scheme would replace furlough – due to end this month – the Chancellor’s unexpected announcement of much more generous payments shows he is prepared to quickly change tack in response to events and advice.

But the fact that he deems it necessary for the taxpayer to pay a sum which it is estimated will run into hundreds of millions of pounds a month shows just how much trouble we are in.

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The response from Labour – that he should have acted sooner – may have some merit, but given the uncertainties and the stakes, ministers are required to act quickly and so the usual accusations about U-turns should not carry the same sting. What Labour described as “chaos and incompetence” may actually be necessary flexibility and speedy decision-making.

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Rishi Sunak unveils new furlough wage extension for businesses forced to close

The CBI’s Carolyn Fairbairn agreed that the “steep rise in infections in some areas means new restrictions to curb numbers feel unavoidable” and said the new money from the Chancellor “should cushion the blow for the most affected and keep more people in work”.

But she stressed that many firms would be “hugely disappointed if they have to close their doors again after doing so much to keep customers and staff safe” and, in an echo of Labour’s argument, she called for “a consistent and open strategy for living with Covid-19 through the autumn and winter”, saying this would save “lives and livelihoods”.

As ever, the devil is likely to be in the detail of this new scheme.

Some businesses may not have been legally obliged to stop trading, but might as well have been. So suppliers to firms ordered to close and those whose business depends upon them may wish to make a case to the Chancellor and/or the Scottish Government for greater help.

Just how much the public purse can afford is a complicated question, but it seems that Sunak, at least, is prepared to listen.

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