Delay furlough changes, says Labour as Treasury say numbers on the scheme halve in three months

ITV News Political Reporter Shehab Khan on what the latest changes could mean for businesses

Labour has called for the government to delay plans to shift some of the burden of paying for furloughed workers to businesses, as the Treasury says the number of people on the scheme has halved in three months.

New figures published by the Treasury today show 2.4 million people moved off the scheme between the end of February and the end of May, with 1 million coming off furlough in May alone.

The government said 2.4 million people remain furloughed down from a peak of nearly 9 million at the height of the pandemic.

From Thursday July 1, employers will have to pick up 10% of their furloughed workers' salaries as the government prepares to phase out the measures.

Shadow Chief Secretary to the Treasury Bridget Phillipson told ITV News it was "essential that economic support and public health measures go hand in hand and that hasn’t been the case.

"Businesses are now being asked to contribute more even though many of them can’t operate at anywhere near capacity."

She added furlough would have to be withdrawn at some point but said when coronavirus restrictions were still impacting many industries it “seems wrong that they’re just being left to sink or swim".

Economists expect to see a spike in redundancies over the summer as furlough is phased out.

"With the cost of keeping employees on furlough rising, we therefore expect to see rising redundancies over the summer, even before the final end of the scheme," the IFS said.

Business Secretary Kwasi Kwarteng has defended the move saying this was "a good time to taper" the scheme.

He told ITV News: "It's not a question of simply having the furlough scheme one minute and then it being turned off the next and you have to pay 100% of the employee’s wages.

"There’s a balance between how much the government pays and how much business owners or employers pay and I think we are striking the right balance.

"The furlough scheme was never designed to last forever and it was going to end at some point and I think this is a good time to taper it away.”

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