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Job Support Scheme

On Tuesday 12th October the Government announced a tiered approach to Coronavirus restrictions.  Liverpool is the first UK city to be directly impacted by the highest level, Tier 3 restriction.  In preparation to this, the UK Chancellor announced a £2.4 billion rescue package the week before.  This was designed to help businesses and people in Coronavirus hotspots.

Here we look at the new three-tiered level of restrictions, plus the rescue package the Government have put in place.

Coronavirus Tiered Restrictions Explained

In an attempt to combat the Coronavirus pandemic in the UK, Boris Johnson announced a new three-tier system of restrictions.  To stop the spread of the virus, each area in the UK will be categorised as either medium, high or very high alert.  Each alert will have a Tier 1-3

Tier 1 – This is aimed at the lower levels of infection.  Restrictions will include the standard national lockdown rules currently in place.  These include –

  • Restaurants, pubs and bars closing at 10pm.
  • The Rule of Six applies both outside and indoors.  This is the total number of people who can meet up together.

Tier 2 – Aimed at areas with a high level of infection.  All the rules of Tier One apply, plus the following –

  • Rule of Six only applies outdoors
  • No mixing is allowed between different households indoors.

Tier 3 – The highest level of infections, therefore the highest level of restrictions.  All the rules of Tier 1 and 2 apply, plus these additional restrictions –

  • Households are not allowed to mix whatsoever – indoors or outdoors.
  • All pubs and bars to close, except restaurants who provide full meals.
  • Gyms, leisure centres, casinos and all betting shops to close.
  • Universities, shops and schools will however remain open.

What is the current Job Support System?

The Government’s original Furlough Scheme is due to come to an end in October 2020.  This scheme saw the Government paying 80% of affected worker’s wages.  A monthly cap was introduced at £2,500.

When will the new Job Support Scheme Start?

The new scheme is intended to launch on 1st November 2020 and is expected to run for six months.  The Government will review this in January 2021.

What is the new Job Support Scheme?

The new scheme is an extension of the system currently in place.  It focuses specifically on areas impacted by Coronavirus restrictions.  The scheme targets businesses which are forced to close due to local lockdown measures.

Eligible employees will receive 67% of their salary.  This will be paid directly to their employer by the Government.  It will be capped at £2,100 per worker.

Businesses will be able to claim for the grant if they are subject to local coronavirus restrictions, and employees are off for at least 7 consecutive days.  Employees need to be on the PAYE Payroll at that business on September 23rd 2020.

The Chancellor states, “This is not a universal approach, this is an expansion of the Jobs Support Scheme specifically for those people who are in businesses that will be formally or legally asked to close.”

This new scheme will put further pressure on Government finances with borrowing expected to exceed £300 billion in 2020.

 

Nigel Carr
Nigel Carr
Nigel is a freelance financial writer and Author at Kinsella Tax. A business graduate he writes on financial matters as well as music for a number of high quality websites.
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