Furlough extension
Chancellor of the Exchequer Rishi Sunak has announced that the furlough scheme has been extended again and will now run until the end of April 2021.

The additional month will continue to see firms able to claim 80 per cent (up to £2,500) for employees’ hours not worked.

In a move to ensure firms can access the support they need through continuing economic disruption, Sunak also stated that he would be extending the government-guaranteed COVID-19 business loan schemes until the end of March.

The changes are set to come ahead of the Budget on 3 March when Sunak has said he will set out the next phase of the plan to tackle the virus and protect jobs.

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According to the government, the Coronavirus Job Retention Scheme (CJRS) has protected 9.6 million jobs across the UK with more than one million businesses accessing loans to help them through the crisis.

The Chancellor 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 that the Government’s loan schemes will give business owners additional certainty going forward into the new year.

The Chancellor confirmed he would review the employer contribution element of the CJRS in January but decided to bring it forward to allow businesses to plan ahead for the remainder of the winter and the New Year.

A Government statement more specifically explained that extending the CJRS until the end of April gives businesses certainty well ahead of the 45-day redundancy notice period, with the Budget setting out the next phase of support more than 45 days before the new end date of the scheme.

As with the furlough scheme extension announced in November, the Government will continue to pay 80 per cent of the salary of employees for hours not worked until the end of April. Employers will only be required to pay wages, National Insurance Contributions (NICS) and pensions for hours worked; and NICS and pensions for hours not worked.

The eligibility criteria for the UK-wide scheme will remain unchanged and these changes will continue to apply to all Devolved Administrations.

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 grant, with a fourth grant being made available from February to April 2021.

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