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Economic Development

Shadow Treasury Minister calls for furlough scheme to be extended

Sunderland MP Bridget Philipson makes case for adapted scheme to help avoid mass unemployment

Labour Party's Bridget Phillipson(Image: PA)

A leading Labour politician has called for the Government’s furloughing scheme to be adapted and extended to avoid mass unemployment at the end of June.

Sunderland MP Bridget Philipson, who was recently appointed Shadow Chief Secretary to the Treasury, has joined a number of business groups in saying that a complete end to the scheme on June 30 would risk “plunging hundreds of thousands of families into poverty”.

Chancellor Rishi Sunak is considering his options on tapering off the scheme and has acknowledged that the current level of expenditure is not “sustainable”, but he has promised there will be no “cliff-edge” cut-off to the scheme.

Groups including Make 海角视频 and the British Chambers of Commerce have called for the Government to support businesses with a phased return to work, including maintaining the furlough scheme in some form.

Ms Philipson said: “We know that life will not swiftly return to normal. Some businesses will start to re-open, whereas others will be hit harder and for longer.

“Any exit strategy must consider a change in the furlough scheme to allow for short-time working, an approach followed by other European countries such as Germany. And as we approach the next cliff edge and the end of the scheme in its current form, ministers must avoid the temptation of thinking their work is done.

“The need for the scheme to be reformed so it can be effectively extended is also a chance to improve it, in ways that make it both better value for the Government and more flexible for workers and their employers.

"For one thing, it would be totally unacceptable for executives and shareholders to profit from public support — so we must move towards a moratorium on dividend payouts and share buybacks, as required by the Danish government, for those companies that benefit from Government support.