Indonesian Prime Minister Rishi Sunak said it is “impossible” to predict how much work the government’s new wage subsidy program will save.
The plan will replace the vacation system, when the government will increase pay for those who cannot work full-time.
The government aims to stop mass layoffs after the government has adopted new measures to deal with the increase in coronavirus cases.
Mr. Sunak said he hopes the plan will “benefit a large number of people”
According to the work support plan, if the boss brings back workers part-time, the government will help them increase their wages with their employers to at least three-quarters of their full-time wages.
It will start on November 1 and last for six months.
How will the work support program work?
According to the plan, the government will subsidize the wages of employees who work less than normal hours due to reduced demand.
The employer will pay for the actual working hours. Then, the government and employers will bear two-thirds of the wage loss between them. However, only employees who can work at least one third of normal working hours are eligible to participate in the program.
Payment will be based on the employee’s normal salary, with a monthly government subsidy of up to £697.92.
Why would the government do this?
Mr. Sunak described the plan as a “radical new policy” aimed at “helping to protect as many jobs as possible” [and] Let people work part-time instead of firing them. “
However, he said that this will only support “viable jobs”, not jobs that exist because the government continues to subsidize wages.
Sanak said at the press conference: “I am not sitting here to explain exactly what work is feasible or unfeasible, but what we have to do now is to gradually develop our business when the crisis has reached a critical juncture. Support.” A meeting was held after the plan was unveiled.
“Obviously, we cannot bear the same level of things we did when this crisis started.”
How much work will this save?
The British Broadcasting Corporation (BBC) understands that the Ministry of Finance estimates that the new employment support program can cover 2 to 5 million people.
However, the Prime Minister said at a press conference that he would “lie” if he tried to give accurate numbers, but he said that some unemployment rate forecasts “are not well understood”.
According to official data, there are currently nearly three million workers (12% of the British workforce) are taking part or all of their vacations. The current vacation is scheduled to end on October 31.
Compared with the vacation system, the government’s contribution to workers’ wages will drop sharply. During the vacation, it initially paid 80% of the monthly salary, up to a maximum of £2500-under the new plan, this figure will be reduced to 22%.
Sonak said: “The main goal of our economic policy remains the same-to support people’s work-but the way we achieve this goal must develop.”
“I cannot save every business, I cannot save every job.”
How much will it cost?
The plan will cost the government about 300 million pounds a month. Companies that use the software can still apply for “job retention bonuses,” and the government will pay 1,000 pounds for each employee who resumes work at least at the end of January.
Mr. Sunak said that similar programs will be provided for self-employed people.
Who will help?
All SMEs will be eligible to participate in the program, but large companies will only be eligible if their turnover declines during the crisis
The plan will start in November and will last for six months. It can be used even by employers who have not used the vacation plan before.
Employees must be in “viable jobs” to benefit from the program, and employees in industries that are currently closed (such as nightclubs) may be lost because they don’t have any jobs.
How do companies view it?
The business lobby group CBI welcomes the government’s plan.
CBI Director General Carolyn Fairbairn (Dame Carolyn Fairbairn) said: “It is right to put help on future jobs, but it can only be maintained during part-time periods. This is to retain skills and work for rapid The way to recover.”
However, Thorsten Bell, chief executive of the Resolution Foundation think tank, said that the new employment plan itself “will not encourage companies to lay off rather than layoffs, because a third of employer contributions means the cost of hiring a person It’s much cheaper. A person full-time is better than two people part-time.”
He warned that the company will receive a £1,000 retention bonus at the end of January to retain workers, and the new plan may create a new “edge of the cliff” for layoffs.
“We now have a lot of motivation to motivate the company to retain part-time jobs until you are eligible for bonuses.”
The Labor Party also stated that it would support any measures to protect employment, but accused the government of being too late.
What about the workers?
Tracey Sheppard (Tracey Sheppard) is a cleaner at a leisure center in Essex. He is on vacation from the end of March. She said she hoped the new employment support program would help her, but there was no guarantee.
She told the BBC’s World At One: “They are a very large company that I serve… but I don’t know if they have the ability to keep me going… I just don’t know.”
She said she was “scared” because her family had only recently moved to the area, which was the only childcare job she could do.
“I heard nothing [from my employer]. The last time I heard from them was the beginning of the blockade. “
What else did the prime minister announce?
The value-added tax exemption policy for hotels and travel companies will also be extended to March. The value-added tax rate that took effect on July 15 was reduced from 20% to 5%, and was originally scheduled to expire on January 12 next year.
However, the Food and Beverage Federation (FDF) stated that this work and the new employment program have “not done enough” to help the industry, which is subject to new restrictions imposed by the government to stop the rise in coronavirus cases.
What to do with the loan repayment?
Mr. Sunak also announced that companies that borrow money through the government loan program will have more time to repay the money.
The Prime Minister said that small businesses that have received “rebound” loans can use the new “payment on demand” flexible repayment system. This means that the loan can be repaid within 10 years instead of the initial 6-year period.
Longer repayment times also apply to small and medium-sized companies borrowing under the Coronavirus Business Interruption Loan Program.
Companies will also have more time to apply for these loans, as well as the suspension of loan plans and future funds by large companies due to the coronavirus. Application dates for various programs are scheduled to end in October and November.
Is the plan effective?
The new employment support programs are part of what we have seen in the past few months and focus on those programs that are considered “viable” jobs. It cannot prevent the unemployment rate in “unviable” jobs from rising sharply in the coming months.
Indeed, even with the announcement this week that Britain is facing a six-month “new normal” of social restrictions, the economic impact of the multi-billion pound package may far outweigh its impact.
The Ministry of Finance has expanded the support bridge it established in March to cover the next six months.
But the new plan requires everyone to participate. For many employers, this will be too much. We are going to find out how much.
Read more here
Is this plan good for you? Do you have questions about this plan? e-mail.
If you would like to talk to a BBC reporter, please provide a contact number. You can also get in touch in the following ways:
- WhatsApp: +44 7756 165803
- Tweet: @BBC_HaveYourSay
If you are reading this page and cannot see the form, you need to visit the mobile version of the BBC website to submit your questions or comments, or you can send us an email in the following ways:. Please indicate your name, age and location in any documents submitted.