Commons statement

Sunak extends furlough with £1bn for Scotland

Rishi Sunak

Statement: Rishi Sunak

Chancellor Rishi Sunak confirm today that the Treasury will help businesses in Scotland should it go into lockdown.

He extended the furlough scheme until March amid renewed demands from Scotland’s First Minister Nicola Sturgeon and her Welsh counterpart Mark Drakeford.

The Chancellor set out the Government’s business support package to the Commons, anouncing that the 80% furlough scheme will continue beyond 2 December in any area of the UK that faces the equivalent of England’s Tier 3 restrictions. 

He said: “The furlough scheme was designed and delivered by the Government of the United Kingdom on behalf of all the people of the United Kingdom – wherever they live.

“It is a demonstration of the strength of the Union – and an undeniable truth of this crisis – we have only been able to provide this level of economic support because we are a United Kingdom.”

The Treasury announced on Saturday it would extend furlough payments at 80% of employee wages until 2 December to support workers in England during a second lockdown that starts today.

Mr Sunak has been urged to extend the guarantee to the devolved nations if they go into lockdown at a later date.

His wriggle room has been increased by the Bank of England which this morning announced it will be buying £150 billion of additional bonds.

Rain Newton-Smith, CBI chief economist, said: “The Chancellor has built a bridge for business to Spring 2021 and taken much needed steps to help firms across the UK survive this winter.”

British Chambers of Commerce director general Adam Marshall said: “These changes give businesses significant reassurance over an uncertain winter, but many will understandably still wish for the government to give a clearer view of the road ahead.

Jonathan Geldart, director general of the Institute of Directors, said: “Extending furlough is the right call from the Chancellor. This will give directors much greater confidence about their ability to keep staff on board through the Winter.

Marc Crothall, chief executive of the Scottish Tourism Alliance said the Chancellor’s decision will come as a huge relief to tourism businesses across Scotland.

“However, furlough alone will not help the industry to survive as we move into what has now become known as ‘the third winter’ for the sector. 

“UK and Scottish governments must continue to recognise the urgent need for more robust funding to be channelled into the sector by way of additional grants so that businesses can remain solvent through to Spring 2021.”

Uncertainty over the UK government’s commitment to supporting the devolved nations emerged in comments on Monday by housing minister Robert Jenrick and Treasury minister Steve Barclay who appeared to backtrack on the announcement.

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