Furloughed Employees

Treasury – in the House of Commons on 22nd June 2021.

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Photo of Nicola Richards Nicola Richards Conservative, West Bromwich East

What recent estimate his Department has made of the number of furloughed employees moving back into work.

Photo of Greg Smith Greg Smith Conservative, Buckingham

What recent estimate his Department has made of the number of furloughed employees moving back into work.

Photo of Rishi Sunak Rishi Sunak The Chancellor of the Exchequer

Between the end of January and the end of April, 1.5 million people left the furlough scheme. The most recent business survey from the Office for National Statistics estimates that the number of employees furloughed continued to decline after that point, to approximately 2 million at the end of May, which is the lowest level reported by the survey since June last year. At the same time, the number of payrolled employees has increased for six consecutive months. I believe that the coronavirus job retention scheme is striking the right balance between supporting the economy as it opens up, continuing to provide support and protect incomes, and ensuring that incentives are in place to get people back to work as demand returns.

Photo of Nicola Richards Nicola Richards Conservative, West Bromwich East

Does my right hon. Friend recall that at the start of the pandemic, many commentators feared that it would lead to unemployment on an unprecedented scale? Has he estimated that impact of his furlough scheme on protecting jobs?

Photo of Rishi Sunak Rishi Sunak The Chancellor of the Exchequer

My hon. Friend makes an excellent point. The furlough scheme has supported more than 11.5 million jobs since the start of the pandemic, and she is right to say that at that point, forecasts suggested that unemployment would peak at around 12%. Those forecasts now show unemployment peaking at half that level, which means 2 million fewer people losing their jobs than previously feared. Our unemployment today is lower than that in Italy, France, Spain, Canada, the United States and Australia, and it shows that our plan for jobs is working.

Photo of Greg Smith Greg Smith Conservative, Buckingham

The figures my right hon. Friend gave in his earlier answers are encouraging, but some employers in my constituency with employees still on furlough tell me that they are desperate to get those employees back to work, but the uncertainty over when restrictions will finally be lifted is holding them back. For example, in the events supply chain, the unwillingness of customers to pay deposits is holding those firms back. Does my right hon. Friend agree that the way to get the economy moving and get those employees back to work is for restrictions to be lifted by 19 July?

Photo of Rishi Sunak Rishi Sunak The Chancellor of the Exchequer

My hon. Friend is right, and my hope and expectation is that we lift those restrictions on 19 July. By that point, we will have done what we set out to do, which is to get extra jabs in more people’s arms to provide us with that extra level of protection. My hon. Friend is right: the only sustainable way to protect those jobs is to reopen the economy so that people can return to work and provide for their families, and move on to bright new opportunities.

Photo of Abena Oppong-Asare Abena Oppong-Asare Shadow Exchequer Secretary (Treasury)

Independent experts have told the Government 12 times that the failure to provide adequate financial support to people self-isolating has contributed to the spread of covid, endangering lives and livelihoods. We now know that the Treasury instructed Government officials actively to supress information about the furlough scheme that was to be used by employers to financially support people self-isolating. Will the Chancellor explain why that instruction was issued by the Treasury? Will he appear in front of the parliamentary Committee’s inquiry into covid to explain why the Government chose not to improve self-isolation support, despite repeated warnings?

Photo of Rishi Sunak Rishi Sunak The Chancellor of the Exchequer

The hon. Lady is wrong, because the Government did no such thing. Indeed, guidance on usage of the furlough scheme was there in black and white—I am looking at it—and plain for everyone to see from the start. At the beginning of this crisis we improved the way that statutory sick pay works to deal with self-isolation. That was one of the earliest steps we took. We then introduced a rebate scheme for small and medium-sized businesses, to claim back the cost of statutory sick pay for isolating employees from the Government. We also introduced a £500 self-isolation payment, which once the isolation period reduced from 14 to 10 days increased in value by 30% and is now worth at least the national living wage to a worker, if not 20% or 30% more, depending on how many days they isolate for. That shows that the Government are supporting those who need to self-isolate. They did so at the beginning of this crisis, and they will continue to do so until the end.

Photo of Mel Stride Mel Stride Chair, Treasury Committee, Chair, Treasury Committee

Given the rapid pace of our economic recovery and the plans for the further reopening of the economy, I support my right hon. Friend’s decision to phase out furlough by the end of September. However, does he accept that a small number of sectors are likely to require yet further support after that time—not least the travel sector, whose revenues, according to evidence received by the Treasury Committee, have suffered a 90% fall during the crisis?

Photo of Rishi Sunak Rishi Sunak The Chancellor of the Exchequer

My right hon. Friend is right to highlight the difficult circumstances facing that sector, which is why I think in aggregate more than £7 billion of support has been provided to the sector through various means. He will know that there are some particularly large companies that talk to the Government on a bilateral basis. It would not be appropriate for me to comment on those conversations, but he will of course be aware of the support we have put in place, for example, for regional airports, the vast majority of which are paying no business rates for the first half of this year. As he would expect, we keep everything under review.