The government’s Job Retention Scheme has, thus far, lived up to its name.
Unemployment is rising but mass redundancies have been avoided and businesses have dared to hope that, with the government’s help, they might find a way through this terrible recession.
But the cost of the taxpayer support is high and rising towards £100bn. This scheme cannot continue and the chancellor has now set out the details of how it will be withdrawn.
Businesses have applauded the decision to allow them to bring back staff part-time from July instead of August.
They are also being asked to shoulder a lower share of cost of the scheme than had been expected (or leaked to journalists) but the chancellor is asking them to start paying for it and this creates a reckoning, a moment of truth.
From August we will start to find out how many companies can afford to hold onto their staff.
Rishi Sunak concedes that there will be a proportion of the 8.4 million people who have been furloughed who will find they that don’t have a job to return to.
It’s too soon to judge the success of this scheme. Much depends on how many people end up back in work.
Getting on for one in three of those who have been furloughed work in hospitality.
It is no surprise to hear the organisations which represent bars, pubs, restaurants and hotels warning of large-scale job losses unless the chancellor comes up with some additional support.
Some sectors of the economy have been hit far harder than others by the lockdown but the furlough scheme treats all-comers equally. This may yet prove a design fault that needs fixing.
Giving companies large sums of money to pay their workers to stay at home was in a sense the easy bit. The hardest yards lie ahead.