Covid Scotland: SNP warning of 'wave of job losses' if furlough not extended

Rishi Sunak must extend the furlough scheme and business rates freeze or risk causing another “wave of job losses”, the SNP has warned.

Alison Thewliss MP warned businesses could be forced to make thousands of people redundant after the UK Government’s plans to phase out financial support for businesses and workers begin from July 1, despite continued lockdown restrictions.

The SNP shadow chancellor said it was crucial that full furlough support at 80 per cent of wages, and the business rates freeze, were extended for as long as is necessary, including until Covid restrictions are fully lifted.

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Ms Thewliss’ comments come after First Minister Nicola Sturgeon last week called on the UK Government to extend furlough, rule out a return to austerity and prioritise a just recovery from the pandemic.

MP Alison Thewliss is shadow chancellor for the SNP
MP Alison Thewliss is shadow chancellor for the SNP

Ms Thewliss said: “The Tory Chancellor must not pull the plug on financial support for businesses and workers before Covid restrictions are lifted, otherwise there will be a wave of job losses across the UK.

"When Rishi Sunak threatened to cut support prematurely last autumn, businesses began laying off workers – and by the time he made an eleventh hour U-turn it was too late for many families who had already lost their jobs and livelihoods.

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“The Tories have made the same damaging mistakes repeatedly throughout the pandemic. They must not do it again.

"There must be an immediate U-turn on these Tory cuts before it is too late. Over a year into this pandemic, many businesses are really struggling with debt and rent arrears, and having to pay more wage costs may push them over the brink."

She added: “It is critical that full furlough support at 80 per cent of wages, and the business rates freeze, are extended for as long as is required by each of the devolved nations, including until Covid restrictions are fully lifted.

“Instead of withdrawing support prematurely, the Chancellor should boost funding for the economy with a major fiscal stimulus, of at least £100 billion, to secure an investment-led recovery – like President Biden is doing in the United States.

"The Tories are intent on imposing another round of austerity cuts no matter the cost. It is increasingly clear the only way to keep Scotland safe is to become an independent country, with the full powers needed to secure a strong, fair and equal recovery.”

A Treasury spokesperson said: “The UK government has provided billions in additional support to protect Scottish jobs throughout the pandemic and the Scottish government is in charge of covid restrictions in Scotland. The furlough scheme is in place until September – we deliberately went long with our support to provide certainty to people and businesses over the summer.”

He added: “To date, the furlough scheme has supported over 11.5 million jobs at a cost of nearly £65 billion. The number of people on the furlough scheme has already fallen to the lowest level this year with more than a million coming off the scheme in March and April – showing our Plan for Jobs is working.

“Businesses can continue to access other support including VAT cuts and our Recovery Loan scheme.”

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