Furlough extension: What is Rishi Sunak’s local furlough scheme for firms forced to shut?

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Furlough has helped millions of people throughout the coronavirus crisis with more than 30 percent of the workforce across the UK furloughed in May. The national scheme will end in October but for some people, it will still be open. Express.co.uk has compiled a guide to explain the new local furlough scheme and how it will work.

The Chancellor of the Exchequer Rishi Sunak is due to announce a local furlough scheme today.

Mr Sunak will make an announcement about how he intends to protect jobs and businesses in the coming months according to a Treasury spokesperson.

A Treasury spokesperson today said: “The Chancellor will be setting out the next stage of the Job Support scheme later today that will protect jobs and provide a safety net for those businesses that may have to close in the coming weeks and months”.

He will also set out plans for a local version of the furlough scheme as the Government considers plans to effectively shut down the hospitality sector in coronavirus hotspot regions.

The new furlough scheme is expected following the announcement of new restrictions being revealed in Scotland, including restrictions on licensed premises.

Government ministers are reportedly considering the scheme as rising rates of COVID-19 cases prompt concern about hospitals being overwhelmed.

A Treasury spokeswoman told The Times: “The next stage of the job support scheme will protect jobs and provide a safety net for those businesses that may have to close in the coming weeks and months.”

England is expected to be divided and organised into three different lockdown tiers next week.

Millions of people will face tougher restrictions as the Government attempts to get to grips on rising coronavirus cases and hospital admissions.

The new plan would divide areas of England into three tiers depending on the severity of the virus in each region.

The strictest “red” tier would see people ordered not to have any social contact with anyone outside their household in any setting, no overnight stays and no organised sports permitted.

The middle amber second tier is being implemented in geographical areas or nationally when there has been a rise in transmission which cannot be contained through local responses such as no household mixing in homes, gardens or in hospitality settings.

The lightest “green” tier would see the first alert one which represents the rules which most of the country has been adhering to since early September with people expected to follow the rule of six and maintain social distancing.

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Pubs, cafes and restaurants could close in Liverpool, Manchester and Newcastle next week, under tougher restrictions expected to be announced on Monday.

Infection rates in Liverpool and Manchester have risen to 552 and 542 people per 100,000 people respectively in recent days.

In Newcastle, the infection rate is 480 per 100,000 people.

This is much higher than the parameters behind the current rules on quarantining for returning travellers where infection rates above 20 people per 100,000 must self-isolate for 14 days.

In total, the highest rate of cases is currently in the Northwest of England at 1,555.3 per 100,000 people.

This is closely followed by Northeast England and Yorkshire and the Humber where rates are at 1,299.1 and 1,193.4 respectively.

Independent SAGE will provide an update on the “rapidly worsening” situation in the North today.

The group said the Government must take action after figures suggest hospital admission in the North are days away from levels seen in London when lockdown began.

What will the new local furlough scheme look like?

In areas where the strictest tier three would be implemented, the local furlough scheme would remain in place to help businesses forced to shut down completely.

The scheme will be significantly more generous than the scheme’s successor, the Job Support Scheme, announced by the Chancellor last month.

The Job Support Scheme subsidises a fifth of part-time wages and requires workers to return to work for at least a third of their usual hours.

Reports suggest the new scheme will support two-thirds of a worker’s wages in areas where businesses are forced to close.

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