Sunak boosts Job Support Scheme

Rishi Sunak has given the part-time Job Support Scheme a significant face-lift, increasing financial support for millions of people. Under the revised scheme, set to replace furlough next month, employers will be required to contribute less to workers’ wages than was previously the case and staff can work fewer hours to qualify for funds.

The government’s contribution to wages will double to just over 60 per cent. Employers can contribute as little as 5 per cent to employees’ wages, down from the 33 per cent minimum contribution under the original scheme.

The revision was made to provide extra support for companies in areas under Tier 2 restrictions whose business has been severely affected by local restrictions. Prior to today’s announcement, these companies were very much in the dark, suffering the consequences of a drastic reduction in customer demand while being unable to qualify for the Lockdown Job Support Scheme, which automatically subsidises 67 per cent of wages for businesses forced to close in Tier 3 areas.

In a veiled admission that he’d got it wrong, Sunak said that firms in Tier 2 areas will be able to claim retrospective grants to cover financial losses incurred since the first regional restrictions were introduced in the summer.

There will also be a significant boost for the Self-Employment Income Support Scheme. Whereas the Treasury previously said it would cover 20 per cent of average monthly profits for the self-employed up to a total of £1,875, it will now increase the amount to 40 per cent up to a total of £3,750.

Today’s announcement was effectively a multi-billion pound U-turn by the Chancellor. Having spent the summer rejecting Labour’s call for a continued furlough scheme for the worst affected industries, Sunak is now delivering just that. It may have a different name, but the upgraded Job Support Scheme is a continued furlough for the hospitality and tourism industry.

“I make no apology for responding to changing circumstances and so today we go further,” Sunak told the Commons today, sensing a political weak spot. It’s unlikely this particular flip-flop will damage the Chancellor, however. Many people will just be pleased to keep their jobs for a few more months.

Test & Trace continues to tumble 

The reality is that Westminster is having to throw more money at businesses because it has bungled the health response.

Test and Trace figures from the week ending 14 October show that just 15.1 per cent of people who were tested received their result within 24 hours, down from 33 per cent in the previous week. The contact proportion of close contacts of people who tested positive was 59.6 per cent, the lowest weekly percentage since the system began and down from 63 per cent the previous week.

Speaking at today’s coronavirus press conference, the Prime Minister said: “I share people’s frustrations and I understand totally why we do need to see faster turnaround times and we need to improve it. We need to make sure that people who do get a positive test self-isolate. That’s absolutely crucial if this thing is going to work the way it can.”

Not good enough. The country hunkered down for months – with all the social and economic consequences that entailed – to give the government time to build a sustainable rapid-response infrastructure. Seven months and £10bn later, it has disintegrated when confronted with a relatively small spike in infections.

Is this really all the British state could muster?

The Brexit endgame begins

EU and British negotiators entered the Tunnel this afternoon as negotiations resumed in London. In a stark contrast to every other round of negotiations, these “intensified” talks will have everything on the table – something the EU refused to commit to in the past. They will also include draft legal texts for the first time, opening the door to concessions from both sides.

Arriving in London, Barnier told the cameras: “It’s very important to be back at the table. Every day counts. And we have a huge, huge responsibility.”

Some analysts have claimed that nothing has changed since last week, when negotiations were suspended by the British side, and they are wrong. As former HM Treasury and EU Commission official Mujtaba Rahman tweeted yesterday evening: “Yes, lots of theatrics involved in [the UK government’s] move, but they won concessions and even the EU side acknowledges this.”

There is now a three-week timeframe to hammer out a deal, which is, to coin a phrase, eminently feasible.

Mutaz Ahmed
Political Reporter