Sunak extends furlough with £1bn for Scotland
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.
Today the SNP welcomed what it called “the long-overdue Tory U-turn” but said it is “far too late” for thousands of workers who have already been made redundant.
SNP Shadow chancellor Alison Thewliss said the Tory government had “hindered Scotland’s ability to respond to the crisis by withholding funds and blocking the devolution of financial powers”.
Liberal Democrat Treasury Spokesperson Christine Jardine said: “This is yet another example of the Government’s incompetence and indecision delaying the action the country needs.
“It was clear to everyone that the furlough scheme needed to be extended to stop people falling into poverty, however until now the Chancellor stubbornly and cold-heartedly refused.”
Prime Minister Boris Johnson insisted he had made a pledge on Monday to extend the furlough offer to Scotland.
I really do not know how to exhaust my affirmative vocabulary any further– Boris Johnson
He said he “won’t budge” on the commitment he gave Scottish Conservative leader Douglas Ross on Monday to extend furlough if the evidence shows a second lockdown in Scotland is necessary.
“I really do not know how to exhaust my affirmative vocabulary any further,” said Mr Johnson.
Mr Ross, speaking yesterday, said: “I have said from the outset that the guarantee to protect Scottish jobs in the event of a second lockdown was an absolute must.
“The Prime Minister made that commitment on Monday and has made that unequivocal again today.
Travel ban may be set in law
The Scottish government is “actively considering” putting a travel ban into law with fines for those who travel in and out of Covid-19 hotspots.
First Minister Nicola Sturgeon said limiting travel was “absolutely essential” in containing the virus.
The current advice on not moving in or out of Level 3 areas is not put down in law and cannot be enforced.
However, this could change when rules are reviewed next week, with the country in a “very fragile” position.