Starmer: Replacement scheme need for furlough

Labour leader, Sir Kier Starmer is calling on the Government to replace the furlough scheme and has made an “open offer” to Prime Minister, Boris Johnson to work with him to create a plan to assist sectors hardest hit by COVID-19.

The leader of the Labour party, made these comments at the Trades Union Congress (TUC) annual conference today (15/09/20) where he suggested the furlough replacement scheme should provide opportunities for part-time workers and reward employers who offer work instead of job cuts.

The furlough scheme will end on the 31st October in which the leader of the opposition believes will leave a “scarring effect” of mass unemployment for the country. In addition to this, Mr Stamer proposed making it illegal for “firing and rehiring” methods where employers let their staff go and bring them back on the payroll but at a lesser salary.

Sir Kier Starmer said:

These tactics punish good employers, hit working people hard and harm our economy.

Imagine how powerful it would be if we could form a genuine national plan to protect jobs, create new ones and investing in skills and training.

I’m making an open offer to the prime minister: Work with us to keep millions of people in work, work with the trade unions and work with businesses, do everything possible to protect jobs and to deliver for working people.

Mr Starmer thinks the Government and employers should provide training and support for those who cannot currently return to work fulltime, he listed the retail, hospitality and aviation as the industries most in need of help.

Mr Starmer added:

We all know the furlough scheme can’t go on as it is forever, but the truth is the virus is still with us and infections are increasing.

It just isn’t possible to get back to work or reopen businesses. It isn’t a choice. It’s the cold reality of this crisis.

So it makes no sense at all for the government to pull support away now in one fell swoop.

This comes as the Office for National Statistics (ONS) data found that since the country went in to lockdown in March, 695,000 jobs have been lost and are no longer on UK companies’ payrolls. Also, the unemployment rate increased to its highest level in two years. It increased from 3.9 per cent to 4.1 per cent in the three months to July, this equates to an increase of 62,000 to 1.4 million.

With young people, being the hardest hit group as those aged 16 to 24-years-old witnessing the biggest drop in employment compared to other age groups. This is the first time the unemployment rate has actually increased since the outbreak of COVID-19 in the UK.

Reacting to this data, Neil Carberry, chief executive of the Recruitment & Employment Confederation (REC), said:

There are clear signs in this morning’s data that the real impact of COVID-19 on the labour market is starting to appear. The number of people in paid employment continues to fall, and redundancies have started to spike. There will be more in the coming months. The rise in unemployment for young people is also a particular concern, given the long-term effects youth unemployment can have. One bright point is the continued rise in vacancies, but while there are always jobs being created, businesses need quick, targeted help in order to keep staff on and boost hiring. Cutting employers’ National Insurance contributions would be one way to do this.