Chancellor Rishi Sunak has confirmed that the UK scheme to pay wages of workers on leave as a result of coronavirus will be extended by four months, to October.
Employees will continue to receive 80% of their monthly wages up to £2,500, but the Government will ask companies to “start sharing” the cost from August.
A quarter of the workforce, over 7.5 million people, are covered by the furlough scheme, which has cost £14bn a month. Trade body UKHospitality estimates that around 2.4 million of these are hospitality workers.
The chancellor said that, from August, the scheme would continue for all sectors and regions of the country, but with greater flexibility to support the transition back to work.
Employers currently using the scheme will then be able to bring furloughed employees back on a part-time basis.
Commenting on the announcement, UKHospitality chief executive Kate Nicholls said: “An extension of the scheme is a sensible, positive and timely move. The scheme has been a crucial lifeline for many businesses and employees. It has helped hospitality overcome the initial crisis, saved businesses and kept jobs open.
“We will now be actively engaging with Government about how the scheme will operate beyond July. The full 80% may need to be extended past July for some businesses in sectors like hospitality that will still operate at much reduced levels of trade, or not yet be able to open.
“Our businesses will need as much warning as possible if they are to be expected to plan ahead for eventual venue reopenings.
“Increased flexibility for hospitality will be equally vital. Hospitality businesses are not able to go from standstill to full capacity overnight.
“The additional flexibility being introduced to the scheme will allow our workers to return to work in a safer, graduated way – that is crucial to help the Government to safeguard public health, jobs and businesses.”