Chancellor announces changes to furlough scheme

The Government has announced the tapering of its furlough scheme for employed workers and the extension of its income protection scheme for the self employed.

Chancellor Rishi Sunak says that in June and July, the furlough scheme will continue as before – with the Government paying 80% of wages up to  a cap of £2,500 – with no employer contribution.

In August, that will continue, but employers will be asked to pay national insurance and employer pension contributions. By September, employers will be asked to pay 10% of wages and the Government will pay 70%. In October, employers will pay 20% and the Government 60%. The scheme will close after October.

Sunak also announced plans for a flexible furlough scheme as of 1st July [“with no central definition of part-time hours”] under which employers can bring people back part time, on a few days a week with the Government topping up the rest of their wages.

In order to do so, Sunak said the furlough scheme would close to new joiners as of 30th June. Employers wanting to place new employees on the scheme will need to do so by June 10th, to allow time to complete the minimum furlough period before then.

The Government has said that in August self-employed people eligible for the Self-Employment Income Support Scheme (SEISS) will be able to claim 70 per cent of their average trading profits (up to £6,570) for the months June, July and August.

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