Published On: Mon, Jun 15th, 2020

Rishi Sunak’s furlough scheme has locked out more than one million Britons – shock report | City & Business | Finance

Chancellor Rishi Sunak has previously stated that he will do “whatever it takes” to keep the economy afloat, but some are falling through the cracks in the system. Over a million people have lost livelihoods while being in lockdown and locked out of support.

The report says: “The Government must assist these people if it is to completely fulfil its promise to do whatever it takes to protect people from the economic impact of coronavirus.”

Since the coronavirus pandemic took hold, Sunak and his team have introduced two support schemes for companies and workers.

The job retention scheme was brought in to give workers 80 percent of their salaries up to £2,500, while the self-employment support scheme was designed to give self-employed people 80 per cent of their average monthly trading profits over the last three years.

The job retention scheme has supported 8.9 million jobs across more than one million employers and there have been 2.6 million claims from the self-employed for help.

Other findings of the report show that data suggests that there are typically more than half a million people starting a new job every month, and there are likely to be hundreds of thousands of people who have set themselves up in business since April 2019 who do not meet the eligibility criteria for either scheme.

But it also says that self-employed people with annual trading profits of £50,000 or above, and therefore are not eligible for the support, total around 225,000 in the UK.

The select committee is concerned about those whose profits fall just above the cap set by the Government.

Freelancers or those on short-term contracts who are also unlikely to be eligible for either scheme.

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The committee received a large number of written submissions from those that are self-employed or on short-term contracts.

The report states that Bectu, a union representing contract and freelance workers in the media and entertainment industries, informed the committee that a survey of its members found that 47 percent of PAYE freelancers working in film and TV were not in a contract at the cut-off date. Only two percent had so far been told they were being furloughed by their employer.

Last week, figures from the Office For National Statistics showed the biggest fall in GDP on record, as the country’s economic output plunged by more than 20 percent.

This is the biggest fall since records began in 1997. The UK has one of the worst coronavirus death tolls in the world, and has taken a crushing economic hit.

Markets have swung wildly in recent weeks, as investors work out where is best to hedge their bets, and the economy has been thrown into disarray.

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Many will be heading back to work today, as non-essential retailers reopen their doors.

Eyes will be on the Government, as businesses and the healthcare service braces for a second spike in COVID cases.

Responding to the findings of the report, a Treasury spokesperson said: “The swift and targeted action we’ve taken has protected millions of jobs and livelihoods and our interventions have been rightly welcomed by the select committee.

“Our wide-ranging support package is one of the most comprehensive in the world – with generous income support schemes, billions paid in loans and grants, tax deferrals and more than £6.5billion injected into the welfare safety net.

“All our support is targeted to make sure we use public funds responsibly, helping those who need it most as quickly as possible, while minimising fraud risk.”

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