Rishi Sunak is expected to announce a significant expansion of the furlough replacement scheme with the government paying a larger share of workers’ wages to protect companies struggling with Covid-19 restrictions.
Sources in business and industry said the chancellor would cut the level of employer contribution companies must make to receive wage subsidies for their workers on the job support scheme (JSS).
In an intervention just over one week before the launch of the JSS, which replaces the multibillion-pound furlough programme from the start of November, the expansion in government funding comes as pressure mounts on the chancellor to act amid the second wave in Covid-19.
In a bid to assuage growing unrest over the government’s handling of the pandemic, the chancellor held a “hybrid” briefing with business leaders and trade unions in a London restaurant, with executives also attending online, early on Thursday before a set-piece Commons economic update.
Sources at the meeting indicated the expansion in the JSS was likely to be applied nationwide, regardless of whether a business is subject to a higher tier of coronavirus restrictions. A reduction in the number of hours an employee must work could also be included
