Nearly 35,000 workers in Scotland removed from furlough scheme
Nearly 35,000 people in Scotland were removed from the UK government’s furlough programme in June, official HMRC figures show.
A total of 141,500 remained on the job retention scheme – which was down from 175,300 at the end of May.
Furlough will be wound down further from Sunday as the UK government asks employers to make a bigger contribution to the wage support scheme.
The Treasury said 900,000 Scots were furloughed through the pandemic.
It added that more than 90,000 businesses had received loans and £1.535bn had been paid in self-employment support.
Across the UK, an estimated 1.3 million people were on the scheme at the beginning of July, down from a peak of 5.1 million at the height of lockdown in January.
It is credited with stopping a spike in unemployment and some fear jobs will be lost when it ends.
Chancellor Rishi Sunak said “thanks to the strength of the Union” and the vaccination rollout, the economy was “rebounding faster than expected”.
Mr Sunak, who is on a two-day visit to Scotland, added “It’s vital this continues, and Scotland’s innovation and ingenuity will be key in creating jobs, powering our growth and driving a green recovery.”
However, the SNP has called on the Chancellor to apologise for “prematurely withdrawing furlough and risking thousands of unnecessary redundancies”.
The top five industry groups with the highest rates of jobs being put on furlough at 31 May 2021:
- Air passenger transport (57%)
- Hotels and similar accommodation (57%)
- Travel agency and tour operator activities (51%)
- Photographic activities (43%)
- Beverage serving activities (43%)
The furlough scheme, drawn up after talks with business groups and union leaders, has cost UK taxpayers almost £50bn to date, arousing fears taxes will have to rise to pay for it.
Under the Coronavirus Job Retention Scheme (CJRS), known as furlough, staff receive 80% of their current salary, capped at £2,500 per month.
Barry McCluskey has been on furlough from his job as an operations co-ordinator in the Royal Concert Hall in Glasgow for nearly 18 months.
He told the BBC’s Good Morning Scotland programme he has been given no confirmation about when he will return to work – and believes the furlough scheme must be extended.
Mr McCluskey said: “I know some football stadiums have reopened with smaller capacities, but I don’t think that’s financially viable for smaller venues like the Royal Concert Hall. It only holds 2,500 people.
“If you take staff into consideration and the cost of trying to run a gig, you really need a full audience to make it financially feasible for the company. As it stands, I have had no confirmation about when I go back to work. So it’s just a waiting game at the minute.
“I totally believe that, especially for the arts and music industries, the furlough scheme should be extended until we can have full venues.
Barry says his long period on furlough has been made “a wee bit more difficult” because he is registered blind.
He explained: “At the start of the pandemic it was very difficult because, when I was going outside, I didn’t know how far I was away from people regarding the two-metre distancing. Plus, stuff like touching surfaces and holding on to handrails while going up and down stairs.
“After I had my vaccines, I became a bit more confident that I’m protected a bit more. “
The UK government has largely footed the bill for furloughed workers, but since 1 July employers have been asked to contribute 10% towards the wages of furloughed workers for hours their staff do not work.
That amount will rise to to 20% in August and September.
It will make the scheme less appealing to employers, although firms are relying on it less as the economy reopens.
The SNP’s Treasury spokesperson, Alison Thewliss, criticised the winding down of the scheme, as well as its timing.
She said: “I would urge Rishi Sunak to explain to the people of Scotland why he is short-changing us on youth jobs, and ploughing ahead with Universal Credit cuts that will undermine the Scottish Child Payment and plunge half a million people into poverty, when at the same time he can find £250million for a UK government yacht.”
The Scottish Chambers of Commerce has called for a halt to the “tapering” of the furlough scheme until all Covid restrictions are lifted.
Spokesman John Erskine said: “There are huge sections of our economy and thousands of employees across Scotland who are still unable to return to work.
“The doubling of furlough contribution for employers at this time is not the right thing to do and that’s what is going to put those jobs at risk.”