Rishi Sunak urged to apologise during Scotland visit for 'prematurely' ending Covid furlough scheme

Rishi Sunak has been urged to apologise for plans to end furlough support for Scottish businesses “prematurely” as the Chancellor prepares to meet with owners during a visit to Scotland today.

Thursday, 29th July 2021, 4:55 am

The visit will involve Mr Sunak meeting with Scottish businesses and furloughed employees who have now returned to work in Edinburgh, Glasgow and Fife.

The Chancellor, whose previous visit to Scotland came in August last year, has repeatedly rejected business demands for an extension of the furlough scheme and business rates relief.

Changes to furlough have required employers to contribute 10 per cent of an employee’s wage from the start of this month, rising to 20 per cent in August.

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Chancellor Rishi Sunak (right) alongside Prime Minister Boris Johnson. Picture: Jonathan Brady/PA

The scheme, which has protected millions of jobs, is due to close at the end of September.

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The Office for Budget Responsibility has estimated the cost of furlough from March 2020 to the end of September this year will amount to about £66 billion.

The SNP's shadow chancellor Alison Thewliss said: “The Chancellor should use his visit to Scotland to apologise to the people and businesses here for withdrawing furlough support prematurely and risking thousands of unnecessary redundancies.

"Although things are looking more positive, we are not out of the Covid woods yet. Many sectors and businesses across the UK are still not operating at full capacity, and many of those that are will need continued support to stay afloat.

"That must include action on the looming debt crisis facing businesses through the repayment of UK Government business loans.

"I would urge Rishi Sunak to explain to the people of Scotland why he is short-changing us on youth jobs, and ploughing ahead with Universal Credit cuts that will undermine the Scottish Child Payment and plunge half a million people into poverty, when at the same time he can find £250 million for a UK government yacht.

“As for his boasts about the supposed strength of the UK, the reality is that the UK is the poorest country per head amongst its neighbours in north-west Europe, with countries similar in size or smaller than Scotland being the fairest and most prosperous.”

Figures from the Treasury showed 173,100 jobs were furloughed across Scotland at the end of May.

Mr Sunak praised the benefits of the Union ahead of his visit, arguing the UK Government’s Plan for Jobs scheme was already helping thousands of 16 to 24-year-olds into work.

The Chancellor is also due to mark less than 100 days until the COP26 summit in Glasgow by seeing first-hand how Scotland is harnessing the power of offshore wind, while also meeting with representatives of Scotland’s financial services sector to thank them for keeping call centres and branches open over the pandemic.

Mr Sunak said: “We’ve come through this pandemic as one United Kingdom – with our Plan for Jobs supporting one in three jobs and tens of thousands of businesses across Scotland.

“Thanks to the strength of our Union, we’ve deployed the fastest vaccination rollout in Europe and our economy is rebounding faster than expected.

“It’s vital this continues, and Scotland’s innovation and ingenuity will be key in creating jobs, powering our growth and driving a green recovery.”