29 May

Chancellor announces changes to furlough scheme

Chancellor of the Exchequer Rishi Sunak today announced changes to the furlough scheme. Currently, the scheme involves the payment of 80% of workers’ wages by the government.


From August, the scheme will be adjusted so that employers must pay the cost of employees’ National Insurance contributions.

By September, after making changes to business premises to make them “COVID-secure” (and by implication, gaining the ability to re-open), employers will be asked to contribute 10% towards their employees’ wages. The government will continue to pay 70% of wages.

In October, employers will be asked to pay 20% of employees’ wages, with the government paying 60%.

If employers wish to furlough staff, the deadline for putting new people on scheme is 10 June, before the closure of furlough applications on 30 June.

From 1 July, employers will have the opportunity to tailor their furlough scheme to their unique needs. For example, a business may wish to open for two days per week, and ask the government to pay its workers’ wages for the other three. This has been dubbed “flexible furloughing.”

The self-employment support scheme is also to be extended, with a second and final grant being paid out in August. The value of the final grant will be up to the equivalent of 70% of self-employed workers’ profits, up to a value of £6,570.

The aim is to retain jobs and ensure that businesses can continue to operate. Unfortunately, the furlough scheme cannot remain open indefinitely, and Mr Sunak has taken measures to gradually move people off the scheme as he attempts to re-start the UK economy.

For more information, please contact: admin@llep.org.uk