This afternoon Chancellor Rishi Sunak announced a four month extension to the multi-billion pound scheme until October. Around a quarter of the British workforce – 7.5 million people – are being paid 80 percent of their wages up to £2,500 per month by the Taxpayer.
Nicky Jolley, managing director of human resource firm HR2day, said employees have caught “furlough fever” and want to remain at home on the scheme.
Ms Jolley warned although wages are being subsidised by the Government businesses are struggling to cope.
She told the Mail Online: “There are some employees who have quite enjoyed weeks off with 80 percent pay, and with the beautiful weather, schools being closed, and perhaps a partner furloughed or having lost their job.
“There have been some requests to remain on the scheme.
“They’ve got a touch of ‘furlough fever’, enjoying what is, in essence a paid holiday.
“Sadly, this is putting strain on businesses who need their staff back.”
Another company boss said: “I need to restart my business to avoid insolvency. I have a plan which ensures it’s done safely.
“The problem is my furloughed staff are finding every excuse not to return to work.
“How do I compete with a chancellor who is paying them not to work?”
In the House of Commons Mr Sunak announced the furlough scheme will be extended from the June deadline until October, although employers will be expected to pick up a share of the bill from August.
The Chancellor also confirmed from August businesses would be able bring furloughed employees back part-time.
Economists at the Institute for Fiscal Studies estimated the extension could cost £10 billion, taking the total amount of support provided by the scheme to around £60bn.
Mr Sunak defended the extension and insisted the cost of not doing it would have been far greater.
Mr Sunak said: “We have stretched and strained to be as generous as possible to businesses and workers.
“This scheme is expensive. It is the right thing to do – the cost of not acting would have been far higher but it is not something that can continue indefinitely into the future.”
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Mr Sunak also confirmed that 267,000 bounce-bank loans have been approved by the Government.
The Chancellor said: “I’m pleased to say over a quarter of a million bounce-bank loans have been approved, 267,000, with over £8 billion of capital that has benefited small and medium-sized companies up and down the UK.
“And on top of that, 35,000 CBILS loans worth over £6 billion have now been put out.”
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