Britain’s government will seek to head off an unemployment crisis by paying bonuses to employers to bring workers back to their jobs from the state’s coronavirus emergency furlough scheme, finance minister Rishi Sunak said on Wednesday.
Under the plan — part of a broader programme of measures — employers would be paid 1,000 pounds ($1,256) for every worker who returns to their job after the furlough scheme expires at the end of October, Sunak told parliament.
“I want every person in this House and in the country to know that I will never accept unemployment as an unavoidable outcome,” Sunak said.
“We haven’t done everything we have so far just to step back now and say, ‘job done’. In truth, the job has only just begun.”
Sunak is already on course to take state borrowing to World War Two levels as he subsidises 9 million jobs on the furlough scheme — equivalent to more than a third of private-sector workers — and supports the incomes of 2 million self-employed.
With close to 45,000 coronavirus-linked deaths, Britain has been hit harder by the pandemic than any other European country. For the worst-affected sectors of an economy that shrank by 25% over March and April, recovery remains a long way off.
Sunak, a 40-year-old former Goldman Sachs analyst who became finance minister in February, has won plaudits for setting aside the pro-market instincts of his Conservative Party to put the state at the heart of Britain’s COVID-19 response.
“We entered this crisis unencumbered by dogma and we continue in this spirit, driven always by the simple desire to do what is right,” Sunak said in his speech on Wednesday.
Sunak’s plan also includes a 2 billion pound ($2.5 billion) fund to create six-month work placement jobs for unemployed 16-24 year-olds and the largest ever rise in partly government-funded apprenticeships.
Sunak said he will spend a further 3 billion pounds to improve the energy efficiency of homes and public buildings, which would support more than 100,000 jobs.
He also raised a threshold for a tax on property purchases to 500,000 pounds, four times its current level, with immediate effect until March 31 to help breathe life into the housing market and the broader economy.