News World UK helps employers with slow phase-in of job shield costs

UK helps employers with slow phase-in of job shield costs

British finance minister Rishi Sunak offered fresh help to employers hit by the coronavirus shutdown on Friday, announcing that future contributions they must make to the government’s costly wage subsidy scheme will be phased in slowly.

In August, companies will only have to make pension and social security payments for the workers they have temporarily laid off while the government will continue to pay 80% of their wages.

Employers would then be asked to pay 10% of the wage costs in September and 20% in October, reducing some of the huge burden on the public finances but a lighter requirement than reported by media before the announcement.

Sunak also brought forward to July 1 the introduction of part-time work under the programme – a demand of businesses seeking to build up their operations gradually after the lockdown – and he extended another multi-billion-pound income support scheme for self-employed workers.

“Our top priority has always been to support people, protect jobs and businesses through this crisis,” he said.

“Now, as we begin to re-open our country and kickstart our economy, these schemes will adjust to ensure those who are able to work can do so, while remaining amongst the most generous in the world.”

Unions and employers are united in support for the programme which, while common in other European countries, represented a major shift for the ruling Conservative Party and its traditional free-market instincts when it was launched in March as the coronavirus crisis engulfed the world economy.

“The changes announced will help ensure the schemes stay effective as we begin a cautious recovery,” Carolyn Fairbairn, head of the Confederation of British Industry, said.

Len McCluskey, leader of Unite, one of Britain’s biggest trade unions, welcomed the changes too but said the government now had to provide more support for sectors hit hardest by the crisis such as aviation and hospitality.

“Without such assistance, and soon, many businesses will simply shut up shop resulting in the mass unemployment the chancellor has sought to avoid these past two months,” he said.


Around 8.4 million temporarily laid off workers, or about one in three private sector employees, are covered by the Coronavirus Job Retention Scheme, which has already cost the state about 15 billion pounds ($18 billion).

It is due to expire at the end of October and Sunak said on Friday that it will close for new claims on June 30.

The Bank of England says the scheme could limit a rise in the unemployment rate to about 9%, double its most recent reading but way below an estimated 20% in the United States.

Under the plan, workers are receiving 80% of their wages up to 2,500 pounds a month.

Some employers had warned that they would not be able to pay 20% of the wage costs of their furloughed staff as soon as August – as reported by media before Friday’s announcement – raising the risk of a fresh surge in job losses.

However, Sunak says the scheme is too expensive to continue indefinitely.

Britain’s borrowing in April alone of over 60 billion pounds was equivalent to almost all of the previous financial year and looks set to hit 300 billion pounds this year, a towering 15% of gross domestic product.

About 2.3 million claims totalling 6.8 billion pounds have been made under the income support scheme for self-employed people.

That had been due to close on Sunday but Sunak said it would be extended and a second, slightly smaller final grant would be available from August.


Top Stories


It is one of the most innovative sushi restaurants on the island, since you can place your order through your interactive table that works...

Tucano Coffee

What does a person need in life? The Tucano Coffee comes to give you the answer: Love.Peace.Coffee. The things are simple. A coffee chain...


A simple, elegant place that honours tradition but turns its back on folklore. Enjoy your excellent quality and tasteful Lebanese meze, without the tambourines...

US: International military education and training for Republic of Cyprus

  The United States is to provide international military education and training (IMET) to the Republic of Cyprus, the embassy in Nicosia has announced. "We plan...

Indiktos Cafe

You have tests or research or articles or presentation, something that needs a lot of study. And when you are home you do not...


How to make triandafillo ice cream, by UK Cypriot chef Loulla Astin

  Just in time for the scorching heat, UK Cypriot chef Loulla Astin has shared her recipe for refreshing triantafillo ice cream -- or as...

Cyprus sprouts with cream and prosciutto

In a big, deep frying pan, fry the prosciutto in the olive oil, on medium heat for 2 minutes. Add the onion and garlic...

Pork burger with sundried tomatoes, mozzarella and anchovies

Mix all the ingredients together with the mince in a bowl, and combine well. Divide into 4 balls and form the burgers. Warm a griddle/pan...


Wash the lamb cauls with plenty of cold water and let them settle in water and vinegar for a little while. Soak the bread crumbs...