‘Some firms won’t be able to find £15 – where will we get thousands from Mr Sunak?’

Anxiety has been voiced about new plans from chancellor Rishi Sunak, which will mean companies stumping up cash to keep the furlough scheme alive.
Colin Neill, chief executive of Hospitality UlsterColin Neill, chief executive of Hospitality Ulster
Colin Neill, chief executive of Hospitality Ulster

One prominent business representative, Colin Neill of Hospitality Ulster, said that since hotels and pubs have not had any income for months, many traders will not be able to find £15 – let alone the thousands of pounds they would have to funnel into what the government calls its new “tapered furlough” plan.

It was announced by Mr Sunak as part of the government’s daily briefing to the press this evening (though some details had been leaked out beforehand).

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It is designed to try and wind down the massive amounts of public expenditure which are currently being used to subsidise employees who have been rendered idle due to the lockdown – encompassing roughly 8.4 million people.

Mr Sunak said that the plan (spelled out in detail below) will mean that in August firms will pay an average of 5% of the gross employment costs they would have incurred had the employee not been furloughed. This will rise to about 14% in September, then 23% in October.

Mr Neill said it could mean, for example, a business with 100 employees finding £6,000 to contribute towards the furlough scheme during August – rising steeply in the months that follow.

“Where do you find it? You’ve had no money in for the last couple of months,” asked Mr Neill.

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“That’s impossible if you have no money. It could be £15 and still some guys wouldn’t be able to find it.”

He said what is really needed to make the scheme work is a set of definite dates from the NI Executive from when they can open (for example in the Republic hotels will be able to re-open from July 20, and pubs from August 10).

Meanwhile Glyn Roberts, the chief executive of Retail NI (representing independent traders), also said that “many of these businesses currently have no income and will be concerned that by August they may be liable” for staff costs.

Ann McGregor, CEO of the NI Ireland Chamber of Commerce, said 85% of chamber members had used the furlough scheme.

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But she sounded a more optimistic note, saying “the Chancellor has struck a balance that will help many firms bring furloughed staff back to work flexibly over the coming months”.

Meanwhile Aodhan Connolly, of the NI wing of the British Retail Consortium (representing many big-name chains) said that while Mr Sunak has avoided a “huge shock” to the economy, asking firms with low-to-no income to pay for staff “is yet another pressure on retailers of all sizes”.


l In June and July the government will pay 80% of wages as well as employer National Insurance (NI) and pension contributions, while employers pay nothing.

l But in August, the government will pay 80% of wages, and employers will pay NI and pension contributions.

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l Then in September, the government will pay 70% of wages, while the company will pay 10% (plus pension and NI).

l In October, the government support for wages will drop to 60%, with the employer picking up pension, NI and 20% of the wages.

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