Business

Miserable Christmas lies ahead without government support, says Unite union

Unite union protester demonstrating against staff cuts at the National Theatre in London

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The Unite union has called on the government to say it will extend its furlough scheme or face “redundancy floodgates” opening in the UK.

Many workers can expect a “miserable Christmas” without targeted support for employers, the union warned.

The government’s furlough programme will end on 31 October.

A Treasury spokesperson said the government had “not hesitated to act in creative and effective ways to support jobs and we will continue to do so”.

Wednesday marks 45 days before the end of the Coronavirus Job Retention Scheme, which is the same amount of time employers must give for notice of redundancy.

The call comes amid growing evidence that the winding down of the scheme is leading to more plans for job cuts.

The number of firms that notified the government in June about plans to cut 20 or more jobs was five times higher than in the same month last year, figures obtained by the BBC show.

A Freedom of Information request shows that in June, 1,778 firms said they were intending to cut more than 139,000 jobs in England, Wales and Scotland.

In total, nine million people have been furloughed for at least one three-week period since March,

However, about 695,000 UK workers have gone from the payrolls of UK companies since then and it is feared that more will follow if the government stops paying to safeguard jobs.

Unite said that without “a clear and urgent sign” from the government that it was responding to calls to extend the scheme, it feared that “employers facing short-term struggles will issue redundancy notices”.

The government has been urged by MPs, business groups, unions and political opponents to continue the furlough programme, in which workers placed on leave receive 80% of their pay, up to a maximum of £2,500 a month.

HR1 forms submitted

(England, Scotland and Wales)

Source: Insolvency Service

The scheme, which has cost more than £35bn, was initially funded by the government, but firms started to contribute to wages in September after the scheme began to wind down.

Last week, the Treasury Select Committee said the government should consider a targeted extension of the scheme.

Unite general secretary Len McCluskey said a signal from the government would “put a floor under struggling employers who are working hard to stabilise in the face of immense challenges”.

“With our competitor nations announcing the extension or modification of their jobs retention schemes, we ask that your government recognises the need for UK businesses and workers to receive similar support,” Mr McCluskey wrote in a letter to Prime Minister Boris Johnson.

A spokeswoman said Unite wanted to see support for sectors including manufacturing, aviation infrastructure, aerospace and hospitality.

The government has repeatedly rebuffed the calls for an extension to the scheme, saying that it has served its purpose in cushioning the economy during the coronavirus crisis.

Chancellor Rishi Sunak has said his priority is to find new ways to protect jobs.

A Treasury spokesperson said: “The furlough scheme has done what it was designed to do – save jobs and help people back into employment.”

The spokesperson said the government had made “unprecedented interventions”, including firms being given £1,000 for every furloughed worker still employed in January, business rates holidays, VAT cuts and the Kickstart scheme, which gives young people jobs experience.