Chancellor Rishi Sunak has announced a five-month extension of the Coronavirus Job Retention Scheme and improved grants for the qualifying self-employed.
The Coronavirus Job Retention Scheme (CJRS), also known as the furlough scheme, will now run until the end of March 2021, with employees receiving 80% of their current salary for hours not worked, up to £2,500 a month.
The next Self-Employed Income Support grant will also increase, from a planned 55% over the period between November and January 2021 to 80% of average profits – again up to a monthly maximum of £2,500.
The furlough scheme was due to end on 31 October but had already been extended to cover the current four-week lockdown in England.
Mr Sunak’s statement came hours after the Bank of England said it was pumping an extra £150 billion into the economy with a programme of quantitative easing.
The Bank, which also announced it was keeping the base rate at the historic low rate of 0.10 per cent, warned the resurgence of Covid-19 would lead to a slower, bumpier recovery.
About £40bn has been spent on the furlough scheme since it was introduced in March 2020. It was originally intended to end in May but Mr Sunak said at the outset that it would be extended “if necessary”.
HM Revenue and Customs, which administers the furlough scheme, has suggested that up to 10% of the money delivered by the scheme to mid-August – around £3.5bn – may have been paid out in fraud or error.
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