New Job Support Scheme unveiled by UK Chancellor to stop mass unemployment

New Job Support Scheme unveiled by UK Chancellor to stop mass unemployment

Chancellor Rishi Sunak has announced the Jobs Support Scheme, replacing the job retention furlough scheme, giving people in work three quarters of their normal salaries for six months.

The UK government will be topping up wages of workers who have not been able to return to the workplace full time due to the coronavirus, instead of paying people to stay at home.

Sunak hopes the new £300 million a month package, starting on 1 November, will prevent mass job cuts when the furlough scheme ends next month on 31 October.

Around three million workers representing 12% of the UK workforce, are benefiting from partial or full furlough leave, according to figures.

The government wants to support the wages of people in work, giving viable “businesses who face depressed demand the option of keeping employees in a job on shorter hours, rather than making them redundant," Mr Sunak said.

He will "support only viable jobs" as opposed to jobs that only exist because the government is continuing to subsidise the wages, adding that he "cannot save every business and save every job."

Mr Sunak also offered businesses that have borrowed money through the government's loan scheme more time to repay the money.

The VAT cut for hospitality and tourism companies will be extended until March.

The chancellor announced that small businesses who took out "Bounce Back" loans can use the new “Pay as You Grow” flexible repayment system, which means repayments on borrowings can be spread over 10 years instead of the original six-year term.

The government rescue packages since March are the largest series of measures since the second world war, leaving the UK with a £300 billion deficit.

Meanwhile, the stock and property markets remain high and employers welcomed the new job scheme.

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