The government has agreed to pay two-thirds of the wages of staff whose business are forced to close amid local lockdowns in the second wave of the virus – but Unite has urged the government to go further.
Chancellor Rishi Sunak has called the latest measures an expansion of the Jobs Support Scheme – and notably not an extension of furlough arrangements — and is aimed only at businesses such as pubs, restaurants and other venues that are required to shut under new Covid-19 restrictions.
From November 1, business which are legally forced to close under the new restrictions will be eligible for government grants to cover the wages of their employees who cannot work. The grants will cover 67 per cent of each worker’s wages up to £2100 a month.
Employers claiming these grants will not be required to make any contributions and can claim the grants after their businesses have shut and their staff have not been in work for at least seven days.
Businesses that are forced to shut will also be eligible for increased business grants up to £3,000 a month paid every two weeks.
Announcing the latest support measures, Sunak said, “I hope that this provides reassurance and a safety net for people and businesses in advance of what may be a difficult winter.”
But the government faced criticism that the support came far later than it should have and is still not enough to roll back a rising tide of job losses.
The latest package of support comes almost two weeks before the present furlough scheme is slated to end on October 31. The government had long faced pressure to extend furlough support after it had become apparent that the pandemic is far from over as a second wave of the virus grips northern communities in the UK that have been forced to go into local lockdowns.
The chancellor’s Job Support Scheme announced last month – a short-time working scheme of sorts – is far less generous than the furlough scheme and requires employers hard-hit by the crisis to make large contributions to workers’ wages to be eligible for government support.
Shadow chancellor Anneliese Dodds said that the chancellor’s delay in delivering the latest support package had “caused unnecessary anxiety and job losses”.
“Even at this late stage, he still has no plan to support sectors that are currently unable to operate at full capacity,” she added.
“None of this was inevitable if the Chancellor had just taken his fingers out of ears and listened to the warnings from Labour and others.
“Businesses and families don’t have the luxury of going at Rishi Sunak’s pace when millions of jobs and livelihoods are on the line.”
The government faced a revolt from metro mayors in the North of England who vowed to take legal action against local lockdowns if they were not accompanied by financial support.
Ahead of the chancellor’s announcement today (October 9), Unite regional secretary for the North West Ritchie James explained why such support was vital.
“Unite has thousands of members across the North West, from manufacturing and the food and drink sector to the NHS and local government, and it is absolutely crucial that an increase in restrictions is accompanied by an increase in support for impacted communities,” he said.
“By all indicators the crisis is set to worsen over the winter months. It is essential that the government implement localised furlough schemes for all staff who cannot work from home and ban evictions for those in danger of being cast into the street,” he added.
“Extra resources must also be available for local authorities and NHS trusts, who will bear the brunt for the demand in services that new lockdowns will bring.”
Responding to the latest package of support, Unite general secretary Len McCluskey said, “It is abundantly clear that a second wave of this virus is sweeping across the country. This was predicted, which is why the chancellor’s closure of the job retention scheme was always going to be premature and regrettable.
“Every lever must be pulled by government to save jobs and avert jobs carnage this winter. Today’s announcement helps and is much needed, but we fear it may again be too little and too late to save many jobs.
“Countries like France and Germany took the decision months back to extend their job retention schemes for two years, putting a stable floor under businesses and workers during these uncertain times,” he added. “We cannot understand why the UK government has not done the same, but has instead chosen to gift a competitive advantage to those countries offering more support.
“Wages support for the north as the region battles this disease is certainly welcome, however we have to question why it is set at only two thirds of wages and not the 80 per cent provided in March,” McCluskey continued. “Bills haven’t fallen, so why has the level of wage support? Workers need to know that the mortgage and rent can be covered, and that food can be put on the table, but employers also need to feel that they are getting the support they need to keep people in employment.
“The country is at a fresh crossroads with this virus and we back all efforts to suppress it, but we urge the chancellor to recognise that this is the moment to revisit his winter economic plan,” he went on to say. “More support is needed to save jobs and protect incomes and he must use the wealth of our nation to provide it.
“I repeat the call from across the labour movement for the chancellor and the government to work with unions and employers now on a plan to create and save jobs in the immediate and longer term. This is a national emergency and as such requires the government to unite the talents of the country to protect the public’s health and our economy.”
By Hajera Blagg