Author Topic: Furlough's further furlong  (Read 985 times)

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Offline lily9889

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Furlough's further furlong
« on: November 02, 2020, 05:42:10 PM »
Furlough's further furlong



Furlough goes on. We were due to be starting a new era of economic recovery and transition to a new jobs market from this
morning. Ballet dancers were to reskill as cyber security consultants, at least according to the poster. But that's not how it's
turned out.

In mid-summer and many times after that, we were told Halloween would be the end of it, for sure. But less than five hours
from the end of October, the prime minister announced that it goes on, at least to 2 December.

That's with the announcement that England is going back into lockdown. We're back to the furlough scheme as it was in
August.

The government pays 80% of normal pay for those on furlough, and employers pay about 5% of their total pay bill in National
Insurance and pension contributions. Plus employers can take furloughed workers back part-time. So that's more generous
than September or October.

Some important details: neither the employer nor the employee needs to have previously used the furlough scheme.
That's important for many people who have shifted jobs in recent months, and for new firms. To qualify, you have to have been
on the payroll and registered for PAYE tax before midnight on Friday 30 November.

You can be furloughed for as little as seven days. There has previously been a three-week minimum.

There are grants being paid to firms forced to close, and local councils in England are getting £20 per head of population to help
out - a total of £1.1bn. There should be a share of that distributed through the funding formula for Scotland, Wales and Northern
Ireland.

There's no mention yet of what happens to the Self-Employed Income Support Scheme, which was due to fall, from 1 November,
to 40% of past year's profits to cover the next three months. That's for the limited number of self-employed people who qualify.

Meanwhile, the Financial Conduct Authority, the industry regulator, said mortgage lenders should extend payment holidays to
a maximum of six months. So if you've already taken a six month holiday from payments, you may not get that continued.



Half a million closures
We were due for a new system that required people in firms that did not have to close to work at least 20% of their normal hours.
In that case the UK government would pay out nearly half of normal earnings. That system required two big revisions, and even
after that, it is not being introduced, at least until early December.

Meanwhile, furlough applies across the UK, though the need for it is lower in Scotland, for now. There's a lot less that has to close.

I'm told that governments in Scotland and Wales and Northern Ireland all asked for a return to full furlough support in order to let
them put in place tight restrictions they deemed necessary to suppress viral infection. Downing Street said no as there isn't enough
money.

But now that England requires lockdown, there is enough money - borrowed money. That's clearly going to rankle and doesn't
sound like a partnership of equals.

Job search
So far, the furlough scheme has helped 9.6m people stay in jobs, though not all at the same time. It's come down a long way from
 its peak. And it's cost more than £40bn.

This week, we had interesting insights into what's happened to the people on furlough, from the Resolution Foundation think tank.
It found 9% of people furloughed at some point had lost their jobs by September.

Among young people, that's as high as 19%, so furlough had helped delay the point that were going to lose their jobs anyway.

It found that, of people who were self-employed in February, 10% were unemployed seven months later, so they've been much less
well protected.

A really important finding from this research is that people have been losing jobs, as they did in past recessions, but much more
than in the past, they've not been getting back into jobs. So there are big outflows from work, and poor outflows back into work.
That's particularly true of young people.

You can follow many more stories here before anyone else. : pgslot