Coronavirus: Support for self-employed extended as Chancellor gives timeline for employers to help pay furloughed staff

  • Video report by ITV News Correspondent Richard Pallot

The Chancellor has extended a scheme supporting the UK's self-employed workers through the coronavirus crisis, amid pressure from MPs.

Rishi Sunak told the Government's daily coronavirus briefing that a second and final grant will be available on the Self-Employment Income Support Scheme in August.

The scheme has been due to expire on Sunday - prompting a cross-party group of more than 100 MPs to call from an extension.

Mr Sunak also outlined a timetable for employers who have been told they must begin contributing to the pay of furloughed workers from August.

The Coronavirus Job Retention Scheme (CJRS) has so far covered the wages of 8.4 million staff in the UK unable to work during lockdown - at a cost of £15 billion.

But ministers have warned the scheme cannot continue "indefinitely," with Mr Sunak today telling employers they will start paying "modestly" into furloughed salaries from August.

The Chancellor also told businesses they will now be able to bring furloughed workers back full time from 1 July - a month earlier than previously announced.

  • The Chancellor told ITV News there was a plan to 'reopen the economy':

It comes as lockdown measures across the UK are set to ease from next week, with England seeing the greatest relaxing of restrictions.

The Treasury has said individual firms will be responsibly for deciding the hours and shift patterns their employees will return to work on and will then be fully responsible for paying their wages while in work.

How does the UK furlough scheme work?

Making the announcement, Mr Sunak described the two UK-wide schemes as "a lifeline for millions of people and businesses."

"We stood behind Britain's businesses and workers as we came into this crisis and we stand behind them as we come through the other side.

"Now, as we begin to re-open our country and kickstart our economy, these schemes will adjust to ensure those who are able to work can do so, while remaining amongst the most generous in the world."

It comes as lockdown measures are gradually eased across the UK. Credit: PA

Under the plans, the level of Government grant provided to furloughed workers will slowly decrease from September, with employers expected to contribute from August.

Here's how those who have been furloughed will be paid:

  • June and July

The Government will continue to pay 80 per cent of wages, capped at £2,500, as well as employer National Insurance and pension contributions.

Employers will not be expected to pay anything during this period.

  • August

From August, employers will be once again responsible for National Insurance contributions and their employee's pensions.

The Treasury says this represents just five per cent of gross employment costs businesses would have incurred had the employee not been furloughed.

The Government will continue to pay 80 per cent of wages as has been the case since the scheme was introduced.

Walthamstow High Street in East London looks busier as Boris Johnson eases England's lockdown. Credit: PA
  • September

In September the Government's contribution to wages will decrease to 70 per cent for salaries capped at £2,190.

Employers will be expected to pay the remaining 10 per cent - raising the cap to £2,500 - and furloughed employees will still take home 80 per cent of their wages.

  • October

The Government will further decrease its contributions, down to 60 per cent of wages up to a limit of £1,875.

Again, employers will have to increase their contribution a further 10 per cent.

The take home pay for employees will still remain at 80 per cent, covering the time they are unable to work.

  • How will the self-employed be supported?

Those eligible for the Government's self-employment support will be able to claim a second, final grant in August of up to £6,570.

The scheme had been due to expire on Sunday.

According to the Treasury, 2.3 million claims have already been made since the introduction of the fund - worth £6.8 billion in total.

Applicants receive 70 per cent of the average monthly trading profits from their business - paid out in a single instalment covering three months' worth of profits.

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