Business groups and professional organizations have welcomed Chancellor Rishi Sunak’s plans to continue government support for businesses and workers affected by COVID-19.

Speaking to Parliament on September 24, 2020, the Chancellor presented a series of measures, including a new employment support program to protect workers returning to part-time jobs and help companies repay loans guaranteed by the government.

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Sunak’s announcement follows Prime Minister Boris Johnson’s speech to the nation on September 22, which outlined measures to tackle the spread of COVID-19 over the winter while growing the economy.

“The resurgence of the virus and the measures we need to take in response pose a threat to this fragile economic recovery,” Sunak told parliament. “So our task now is to take the next step in our economic plan, fueling the recovery by protecting jobs during the tough winter months. “

To this end, employers may take advantage of a new employment support program From November 1, the government will directly support viable jobs in companies facing weaker demand during the winter months due to the coronavirus.

Under the six-month scheme, the government will contribute to the wages of employees who work fewer hours than normal due to declining demand.

According to the Treasury, employers will continue to pay staff wages for hours worked – but for hours not worked, the government and employer will each pay one-third of their equivalent wages. Employees must work at least 33 percent of their usual hours and the level of the subsidy will be calculated on the basis of the employee’s usual salary, which has been capped at £ 697.92 per month.

The Jobs Support Scheme is open to companies that have not used the leave scheme and to all small and medium-sized companies eligible to join.

“Employers who retain staff on leave on shorter hours can claim both the employment support program and the job retention bonus,” Sunak said.

Businesses that have taken advantage of Bounce Back loans have more time and greater flexibility to repay their loans with the introduction of Pay As You Grow which extends repayments from six to ten years.

“I’m also changing the terms of our other loan programs,” Sunak said. “More than 60,000 small and medium-sized businesses have now taken out business interruption loans against the coronavirus.

“To help them, I plan to extend the government guarantee on these loans up to ten years, which will allow lenders to give people more time to repay. I am also extending the maturity of all of our loan programs to the end of the year. And we’re starting to work on a new successor loan program, which is expected to begin in January. “

Commenting on yesterday’s announcement, Mike Hawes, managing director of automotive trade body SMMT, said: “The Chancellor’s Employment Support Program is welcome and should provide temporary relief to the automotive industry, which has been hit so hard by the pandemic, as were flexibilities on loan schemes and tax deferrals.

“We need to make sure, however, that it is not just a short-term lifeline and, like programs elsewhere, ensure that it supports jobs through the duration of the pandemic and the recovery.”

Warning, Stephen Phipson, The managing director of the employers’ organization of engineers Make UK said: “I warmly congratulate the Chancellor for taking decisive action which will help avoid the major layoffs we faced had there been an end to the contract. government support.

“On this basis, we must also recognize that there are certain sectors of manufacturing where there is still not enough demand to even lead to part-time work. These are viable companies, often world leaders, facing a lasting but temporary lack of demand. The aerospace and automotive sectors in particular, along with their supply chains, are high-skill, cutting-edge areas that will be the growth sectors of the future.

Review of reactions

“The impact of the sharp and sustained drop in aviation demand threatens the future of many businesses. The employment support program announced today will help minimize damage and help businesses retain valuable skills and experience. The slow recovery expected in the most affected sectors means that more support will be needed. “
Paul Everitt, Managing Director of ADS

“It is right to target the aid on jobs of the future, but can only be part-time as long as demand remains stable. This is how skills and jobs can be preserved to enable a rapid recovery. Wage support, tax deferrals and help for self-employed workers will reduce the scarring effect of unnecessary job losses as the UK tackles the virus. “
Dame Carolyn Fairbairn, Executive Director of CBI

“We welcome the Chancellor ensuring that decisions to protect public health are informed by the need to protect the economy, people’s jobs and the prospects of young people in our schools and workplaces.”
Mike Cherry OBE, National President of the Federation of Small Businesses


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