Furlough scheme extended by one month

The furlough scheme has been extended by chancellor Rishi Sunak until the end of April 2021, with the government continuing to contribute 80% towards wages while businesses struggle amid operating restrictions.

The news comes as millions of additional people enter the strictest tier three rules on Saturday 19 December, with pubs and bars among businesses forced to close. 

Businesses will also be given until the end of March to access the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Large Business Interruption Loan Scheme. These had been due to close at the end of January.

These changes come ahead of the Budget, which the chancellor has confirmed will take place on 3 March 2021. 

The chancellor said he would review the employer contribution element of the Coronavirus Job Retention Scheme in January, but decided to bring this forward to allow businesses to plan ahead for the remainder of the winter and the New Year.

The government will continue to pay 80% of the salary of employees for hours not worked until the end of April. Employers will only be required to pay wages, National Insurance Contributions (NICS) and pensions for hours worked; and NICS and pensions for hours not worked.

The eligibility criteria for the UK-wide scheme will remain unchanged and these changes will continue to apply to all devolved administrations.