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Oct 1, 2021

Furlough scheme ends after 18 months

The furlough scheme closed on 30 September 2021 after seeing 18 months of the Government paying part of the wages of millions of workers.

Chancellor Rishi Sunak said he was "immensely proud" of the near £70 billion coronavirus job retention scheme, to use its formal name.

The scheme had supported a total of 11.6 million jobs since its announcement on 20 March 2020, according to official statistics from HMRC.

The furlough scheme allowed businesses to retain workers during lockdown restrictions, by seeing the Government pay 80% of employees' wages, which employers could then top up.

The scheme began winding down on 1 July 2021, seeing the Government pay 70% of wages and employers 10%. On 1 August, the Government's contributions decreased to 60% and employers' rose to 20%.

Around one million workers were on the scheme by 30 September 2021, according to the Resolution Foundation, which it says pushes up the risk of an increase in redundancies.

The free-market thinktank the Institute of Economic Affairs is optimistic, however, arguing:

"Job vacancies are at a record high. Even if those furloughed now lose their jobs, they should be able to obtain new ones fairly soon."

Controversy still surrounds the three million people  ‘excluded' from the furlough scheme, including company directors who relied on dividend payments before the pandemic.

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