Chancellor plans to reduce furlough pay from 80% to 60%

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Chancellor plans to reduce furlough pay from 80% to 60%

Rishi Sunak, Chancellor of the Exchequer has said that the furlough system is not sustainable and is preparing to cut the 80 per cent of wage subsidy offered to 60 per cent, in the first steps to bring the programme to an end.

Mr Sunak is set to announce plans next week which will wind down the scheme from July onwards.  This news has arrived as government sources have expressed worry regarding the cost of the scheme and employees becoming “addicted” to it.

Mr Sunak said:

I’m working, as we speak, to figure out the most effective way to wind down the scheme and to ease people back into work in a measured way.

Back in April, the Treasury announced that the Furlough Scheme was to be extended from the end of May to the end of June, allowing staff to be on furlough for another month.

It has been suggested the scheme will cost £10 billion-a-month, but Mr Sunak believes this was “the right decision” to make.

Not to mention in the same month the CIPD suggested that employers would like the Government to make the Coronavirus Job Retention Scheme (CJRS) more flexible, making it possible for furloughed workers to work reduced hours and for the scheme to be extended to the end of September.

A senior government source said

People are addicted to the scheme. We’re not talking about a cliff-edge but we have to get people back to work.

Matt Hancock, secretary of state for health and social care said:

We’ve got to wean off it.

HM Revenue & Customs (HMRC) revealed this week that 6.3 million jobs have been furloughed since the scheme went live. However, the Office for Budget Responsibility has predicted that if the number of people furloughed reaches 8.3 million the scheme will cost £42 billion over the course of three months.

Think tank, Resolution Foundation research also warned that the COVID-19 crisis could result in a rise of 640,000 18-24-year-olds being pushed in to unemployment this year.

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22 Comments - Write a Comment

  1. If you are furloghed on 80% can they reduce it to a lower percentage or do you stay on the 80%

  2. This will make the vulnerable people go back to work when they should be sheilding.

  3. People are struggling as it is and you on about cutting the money to 60%, that’s an absolute joke, you can’t run a bath mr sunak

  4. If you withdraw furlough you will cause more deaths through hunger and poverty ,stop victimising the vu erable and poorest in our society as they are the foundations that make this country work the worst paid workers including NHS staff have saved this country while the rich have yet again let them do it ,shame on you

  5. I feel forced to ask for furlough as even though I’ve been working from home for four weeks, my company want me back in work but are not implementing any social distancing rules or guide lines to follow regarding social distancing is this legal ? as the people I work for often encroach my personal space, my partner and son are both asthmatic so this is very worrying .

  6. We can’t go back to work until our workplace is open again. How does that make people addicted to furlough? It is not our choice. I would go back tomorrow if I could.

  7. I work in the hospitality business which would be deemed as mass gatherings. As I physically cannot go back to work any time soon, how do you propose I live on 60% of my wages ( minimum wage rate).

  8. The furlough scheme is a joke. All those who are working and making the country run are being paid 20% for the work they do. They don’t get time to sit around having BBQ’s.

    You all sit and moan about it. Go outside and don’t keep your distance. Have BBQ’s. But still your getting 80% of your wages for doing just that.

    He should lower the amount. That should get you lazy sods of your backside.

  9. If they reduce it to 60% I won’t be able to cover my rent. I work for nhs and my pay im a band 2 domestic has to cover 4 adults I’m fuloughed at evening job but still struggle to make ends meet. Other people in household are self employed and can’t get any help as they don’t make a profit.
    Keep the fulough 80 %. For working people. People on dole are laughing no change in the lifestyle to the ones who don’t need to be on dole

  10. Excuse me Dean Perry..
    I am 26 years old I work as cabin crew full time and I also run a mobile hair & beauty business.. neither of which I can do at the moment. People are furloughed because THEY CANT WORK or the company can’t afford to keep them as they’re not busy enough. How dare you call us lazy. I may be off but I’m doing shopping for my elderly vunerable neighbours, picking up their prescriptions and doing whatever I can to keep THEM SAFE. not everyone is running off and breaking the rules just a small minority.

  11. Dean Perry- you are a joke!
    Do you really think people are happy about being at home? We want to return to work and yes get our full wage! We have been put in this position. I’ve worked for my company 20 years, count sick days on one hand, never not worked!!.
    So don’t you be calling people lazy!.

  12. i think its a fantastic idea, we cant afford to pay peoples wages long term. it would destroy the economy for our children and our children’s children. 80% was always over egged it should have been 60% from the start.

  13. I am in to my 2nd week of ferlow and have been told if I have to take a weeks holiday if i have to do another 3 weeks can they make me take holidays I have looked on the Gov website and they can claim 80%of my holiday pay so can I refuse to use holidays

  14. Furlough payments will be reduced to 60% from July , which is all well and good . Im a hairdresser so im sure i won’t go back before then . Problem is i cant wait to go bavk to work as i really miss the social side , but unless the schools go back I have no one to look after my children ??

  15. Dean perry , grow up
    You need to think this is not peoples choice,certainly not mine , i am losing about £800 a month on this scheme and would much rather be at work
    So think before you make stupid comments

  16. People are addicted lol, 😂 I mean the freedom is nice but people are struggling out here, same people who already live pay check to pay check. Most people are bored and broke and wana go back to work, because our mediocre lives only mean something when working a job. My heart goes out to the people living outside of their means, they really need that 80%.

  17. Dear Perry
    The fact that you think people are enjoying being furloughed is seriously misjudged. I have been furloughed and am are from lazy. Before being furloughed I worked full time hours whilst studying full time. My husband is still working luckily, and I am home alone a lot. We do not all have the luxury of living with multiple family members and it can be lonely for some. The fact that you think we are all having BBQs in the sun is misguided. The majority of people furloughed are struggling to make ends meet let alone affording BBQs, and lots of people won’t even have a garden to have a BBQ in. The large majority are stuck indoors, hating that they cannot work and have no money. I personally cannot wait for work to give me the go ahead to get back to work. I miss my friends, I miss earning my money. I miss studying at university and I miss working for my living. Please think before you post next time and you might save yourself from looking like a complete plonker who lacks empathy.
    FYI all the people still going into work are still getting their FULL wage. You only get 80% of your wage if you are furloughed and are NOT ALLOWED to go into work. It’s not a case of being lazy, it’s a case of employers being told by the government they CANNOT allow people to go to work. I’d much rather be at work and earning my full wage thanks.

  18. 80% wage tax 20% you left with 60%, of your wage…. now you get 60% of wage are they going to tax that aswell …. TIME 4 A CHANGE !

  19. Totally agree with Dave perry! cut it straight down to 60% and all of us that are working and keeping the country going we shouldn’t be paying taxes up to the same value. key workers who are risking their lives going to work for 20% of their wages. Its a joke and you will all want your annual leave when you get back.

  20. Ive been back at work a week – yet some refused to return – yeah checked the weather report did you?
    Our company is fully compatable with every safety issue and weve had to safety in the workplace training on line – they just refused to come back – and none of them are high risk. Im sorry but Dean is right – some people are treating this like a great big holiday now the suns shining

  21. People treat furlough pay as a right, its meant to be instead of redundancy so start moaning when its 70 quid a week same as those who are not entitled and have to claim unemployment like me for the first time in my life . .

  22. Ashley Hunt and Dave Perry don’t know what they are talking about! I am furloughed and am longing to get back to work but it’s not up to me, it’s up to my employer and they have decided we can’t go back until end of June. I think a lot of companies are themselves using the furlough scheme so they don’t have to pay wages themselves. It is not a choice we have all made and most of us are worried about paying mortgages and rent with only 80% of our wages. Also key workers are NOT being paid 20% of their wages, they are on full pay!

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