Setback for Sunak
Quarter of firms ‘will struggle’ with furlough pay
Malcolm Cannon: ‘when the support ends in August, jobs will be lost’
A quarter of businesses using the Job Retention Scheme say they will struggle to contribute to furloughed workers’ salaries from August.
The findings will be a cause for concern at the Treasury as Chancellor Rishi Sunak prepares to unveil a timetable for asking companies to pay at least a fifth of a workers’ salary and make national insurance payments.
A survey of almost 700 company directors by the Institute of Directors revealed found that about half of those using the Job Retention Scheme for their staff said they could meet this target. However, a quarter said they could not afford any amount.
More than a third said they would bring the majority of their furloughed workers back part-time, if the scheme allowed it. Less than one in ten said they wouldn’t bring anyone back part-time.
To protect jobs, the institute called for as much flexibility as possible in the system, with the majority of those polled who had staff on furlough saying they would make use of shorter minimum furlough periods if allowed.
Currently, workers must be on furlough for at least three weeks, making it difficult for firms to react to uncertain demand.
As businesses return to work the Institute of Directors called on the Government to provide targeted financial assistance for SMEs needing to make health and safety adaptations to their workplaces.
Around one in three business leaders polled said financial support for adjusting workplaces would help get their organisation operating safely under social distancing, second only to better clarity around commuting on public transport.
The polling was conducted between 20-27 May, and received 697 responses.