LONDON (Reuters) - British finance minister Rishi Sunak announced his latest programme to stave off a surge in unemployment on Friday, offering extra help for businesses and workers who are forced to stop work during local coronavirus lockdowns.
In a move likely to cost billions of pounds over the six-month duration of the new scheme, Sunak said the government will pay up to two-thirds of each employee’s salary, with a cap of 2,100 pounds a month, if they work for companies that are forced to close temporarily.
The announcement represented an expansion of the government’s Job Support Scheme - which itself is the replacement of the broader furlough scheme that ends this month - for companies ordered to close and their workers.
Sunak had previously resisted calls to increase the generosity of the government’s support schemes amid fast-rising job losses and his announcement on Friday is likely to herald the temporary closure of bars and other businesses.
Scotland’s government has already ordered a 16-day closure of pubs in the country’s two biggest cities starting on Friday.
As well as the new subsidies, he also announced more generous grants for lockdown-hit companies, offering up to 3,000 pounds per month payable every two weeks, compared with 1,500 every three weeks under the standard scheme.
“I hope that this provides reassurance and a safety net for people and businesses in advance of what may be a difficult winter,” Sunak said.
A Treasury source said the new wage support measures, which will last for six months from Nov. 1, were likely to cost hundreds of millions of pounds a month.
Under the scheme, employers will not be required to contribute towards wages and only asked to cover social security and pension contributions.
Reporting by Andy Bruce and William James; Editing by William Schomberg
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