In a bid to provide some certainty into the New Year, in these incredibly uncertain times, the Chancellor, Rishi Sunak, has announced the furlough scheme is being extended for an extra month – the scheme is now scheduled to be available until the end of April 2021.
He also confirmed the government will continue to pay 80% of wages until the end of the Scheme, so the government contribution will not be reduced at the end of January 2021, as previously anticipated. 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.
In addition, the Chancellor will be extending the government-guaranteed Covid-19 business loan schemes until the end of March 2021, in order for businesses to access the support needed throughout the ongoing economic disruption.
Businesses will also be given until the end of March to access the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Large Business Interruption Loan Scheme. These had previously been due to close at the end of January 2021.
The government has already announced that more support will be available beyond March, through a successor loan scheme. More details of the scheme will be announced in due course, with the government providing a further update on wider Covid-19 economic support at the Budget on 3 March, clearly setting out the next phase of the plan to tackle the virus and protect jobs.