UK improves new jobs support scheme after criticism

LONDON: The UK government on Thursday improved its new jobs-support scheme after businesses hit by regional coronavirus lockdowns claimed it did not go far enough.

Finance minister Rishi Sunak told parliament that he will make the scheme more generous by, for example, cutting employer contributions.

Despite the change, the scheme remains much watered down compared with a government jobs furlough package that ends on October 31.

Thursday's changes also include additional help for self-employed workers and grants for businesses in regions facing tighter virus curbs, particularly in the struggling hospitality sector.

"I've always said that we must be ready to adapt our financial support as the situation evolves and that is what we are doing today," Sunak told parliament.

"I know that the introduction of further (virus) restrictions has left many people worried for themselves, their families and communities.

"I hope the government's stepped-up support can be part of the country pulling together in the coming months," the chancellor of the exchequer added.

To benefit from the new scheme, staff have to work only 20 percent of their normal working hours as opposed to one third.

Employer contributions for unworked hours have meanwhile been sharply reduced to just five percent from one third.

"These changes mean more employers can access the scheme and more jobs will be protected," Sunak said.

Analysts expect a surge in unemployment following the end of the far superior furlough scheme that has been paying up to 80 percent of wages for millions of workers.

Sunak has stated that such a scheme is not sustainable after the coronavirus fallout sent the UK's national debt soaring.

More than half of Britain's population is meanwhile under tighter curbs aimed at halting a nationwide surge in Covid-19.

Prime Minister Boris Johnson's government this month introduced a localised three-tier alert system to try to contain the disease.

Swathes of northern England, including the cities of Liverpool and Manchester, have been placed under more stringent restrictions, joining Scotland, Northern Ireland and Wales with tighter curbs to help stem spiking infections.

Some virus hotspots are seeing bans on household mixing and the closure of pubs, bars, casinos and other venues.

That has sparked outcry from the embattled hospitality sector.

Britain has suffered Europe's worst death toll from coronavirus, with more than 44,000 deaths.

New cases hit a record-high of more than 26,000 on Wednesday, while there were a further 191 recorded deaths.

The government's tweaked jobs plan comes one day after official data laid bare the vast financial cost of the pandemic.

Britain's national debt last month hit a record £2.06 trillion ($2.65 trillion, 2.23 trillion euros), equal to 103.5 percent of the nation's total annual economic output.