When does the furlough scheme end?

THE furlough scheme is due to end in October with the government already starting to wean off its support.

The coronavirus job retention scheme covers 80% of the wages of furloughed workers, up to a maximum of £2,500 per month.

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But during an update to Parliament on Tuesday, Scottish SNP MP Ian Blackford called for Prime Minister Boris Johnson to extend the furlough scheme.

Mr Johnson pledged to continue to support businesses, especially in Scotland, but added that his government wants to see "businesses continuing and jobs being created".

The Treasury has also confirmed to The Sun the scheme will end as planned.

But when exactly will it come to an end?

Here's everything you need to know about the future of the furlough scheme and how it affects you:

When will the furlough scheme end?

The furlough scheme will be coming to an end on October 31.

When the Chancellor Rishi Sunak first announced the scheme on March 20, he said it would only last until May 31.

But since then, the government has announced two extensions of the furlough support, meaning that businesses can still take advantage of it until the end of October.

In the meantime, the government's contributions have dropped and employers have started to pay a higher proportion of furloughed staff's wages.

Employment experts have warned that withdrawing the scheme could put thousands of jobs at risk.

Several MPs have called for furlough to be extended, including the Commons Treasury committee and former Work and Pensions Secretary Stephen Crabb.

To try and prevent the job losses the government has promised employers a new £1,000 bonus for each furloughed worker that is rehired and employed continuously through to January 31, 2021.

How has the furlough scheme changed and what happens next?

The government announced a shake-up to the furlough scheme in June that saw a number of changes come into force from July 1 onwards.

From July 1, bosses have been able to bring furloughed employees back to work for any amount of time and shift pattern, and still claim furlough payments for the time they are not working.

Then from August 1, businesses started to pick up part of the furlough bill and now have to pay national insurance (NI) and pension contributions. 

This represents about 5% of employment costs for businesses. 

Changes from September

As of September 1, the government's contribution towards furloughed workers' wages has fallen from 80% to 70%, up to a cap of £2,187.50 a month.

This doesn't mean you'll take home less cash though.

Employers must now pay 10% of salaries to make up the rest of the 80% of wages, up to a cap of £2,500 a month.

Changes from October

In October, the government's contribution will fall again to 60% of wages up to a cap of £1,875 a month.

This will see businesses have to pay 20% of salaries to make up the difference, and they will still need to make NI and pension contributions. 

This means employers will be footing the bill for 23% of employment costs.

What is the furlough scheme?

If your employer has been forced to close temporarily due to coronavirus, it can claim back part of your wages from the government.

Claims are capped at £2,500 a month for each employee – so if you usually earn a lot more than that you'll see a bigger drop in salary.

Your company can top up the remaining money you'd usually be paid, but many businesses are taking a serious hit and have chosen not to.

In previous months, bosses could also claim employer national insurance contributions and minimum automatic enrolment pension contributions.

But this ended on July 31, so now company bosses have had to stump up instead.

How does the furlough scheme work?

ANY UK organisation with employees can apply to furlough their workers, including businesses, charities, recruitment agencies and public authorities.

It’s up to your place of work to apply to the scheme, meaning you won’t need to contact the government yourself.

To access the scheme, your employer must comply with the following:

  • Designate employees who cannot do their jobs due to the coronavirus measures put in place by the government
  • Notify those employees of their new “furloughed” status
  • Submit information to HMRC about furloughed employees to set up a system for reimbursement and about existing systems that will facilitate payments

To be furloughed, you must have been on a payroll on March 19.

Workers can ask previous employers to rehire and furlough them, even if they left for another job, but firms don’t have to do this.

The furlough scheme did, however, close to new applicants on June 10.

How many people have been furloughed?

More than nine million workers have been furloughed, although new applicants were prevented from joining the scheme from June 10.

Two-thirds of British businesses have used the government's scheme since it was announced, while one in three companies have put at least 75% of their workforce on furlough, according to the British Chamber of Commerce.

But there are concerns many struggling companies will lay off staff without the security of government-backed cash.

Under current employment laws, companies have to give 45 days notice before cutting roles.

On July 8, Chancellor Rishi Sunak said in a statement to MPs: "Furlough has been a lifeline for millions supporting people and businesses to protect jobs. But it cannot and should not go on forever.

"It gives people false hope that they would be able to return to the jobs they had before."

How much has the scheme cost the government?

The Treasury has estimated that the furlough scheme has so far cost the government almost £32billion.

Additionally the cost of the support scheme for the self-employed is more than £8billion.

Earlier in April, the qualifying date workers had to be employed on to be eligible for the scheme was extended from February 28 to March 19 – benefitting up to 200,000 extra workers.

But thousands of workers are missing out on furlough pay due to aloophole.

We've put together a guide to how furlough affects you, including pay, annual leave rights and how it works if you're on maternity or sick leave.


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