Furlough scheme extended until April 2021

The furlough scheme has been extended until the end of April 2021 with the government continuing to contribute 80% towards wages to employee’s pay, Chancellor Rishi Sunak has confirmed today (17 December).

The government will also extend current government-guaranteed Covid-19 business loan schemes until the end of March.

This includes the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, and the Coronavirus Large Business Interruption Loan Scheme, which had initially been due to expire at the end of January.

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While the Chancellor initially said he would review employer contributions to the CJRS in the new year, he has brought forward the decision to “allow businesses to plan ahead for the remainder of the winter and the New Year”.

The changes come ahead of the Budget review which is due to take place 3 March 2021, in which the next phase of the Covid-19 and job protection plan will be announced.

The furlough scheme was first introduced in March 2020 in a bid to reduce permanent redundancies caused by the coronavirus. It was originally set to end in November, but the chancellor later made the decision to extend the support amid the second lockdown this winter.

In a statement today, Sunak said: “Our package of support for businesses and workers continues to be one of the most generous and effective in the world – helping our economy to recover and protecting livelihoods across the country.

“We know the premium businesses place on certainty, so it is right that we enable businesses to plan ahead regardless of the path the virus takes, which is why we’re providing certainty and clarity by extending this support, as well as implementing our Plan for Jobs.”

Business Secretary, Alok Sharma, said: “While our loan schemes have provided a vital lifeline to millions of firms across the country, we know that business owners need additional certainty as we head into the New Year.

“Extending government-backed loan schemes will give companies right across the UK the finance they need to support, protect and create jobs as we build back better from the pandemic.”


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