Government should extend furlough scheme until 2021

The Resolution Foundation said in a report on Tuesday that in the case of retail and hospitality workers the UK government should extend its furlough scheme until the end of the year.

Implemented in March, the scheme offers support to businesses struggling to keep their staff on the books as a result of the coronavirus pandemic.

The think tank said that businesses in retail and hospitality would be hardest hit and should be offered extended support so that they can get back on their feet.

It also argued in favour of opening up the scheme to workers from all sectors at least until early August, which would be a month longer than planned.

The Resolution Foundation also called for employers to be allowed to bring workers back on a part-time basis while still receiving the 80% government subsidy for those hours which staff do not work.

More than 6m jobs were being supported by the scheme that was scheduled to expire at the end of June.

According to Reuters, the government is keen to ensure businesses and workers do not become too reliant on the programme, which government forecasters estimate will cost £49bn in its first three-and-a-half months of operation.

Researchers at the think tank, Torsten Bell, Laura Gardiner and Daniel Tomlinson said on Tuesday: “Moving too quickly could cause a second surge in unemployment, while moving too slowly would fail to support the recovery.”

Prime Minister Boris Johnson said the day before that coronavirus infections had peaked, and that people who could not work from home should return to their workplaces if possible.