British finance minister, Rishi Sunak, announced fresh plans for an employment support scheme, on Thursday, during the pandemic.
Sunak also said he would extend support loan repayments for businesses and delay ending a tax cut for the hospitality sector which has been severely hit by COVID-19 restrictions.
“These are radical interventions in the UK labour market, policies we have never tried in this country before,” Sunak told parliament.
Around 5 million jobs were still supported by the previous programme at the end of July, according to tax data, and earlier on Thursday Britain’s statistics agency estimated that one in eight workers were being helped by the programme in early September.
“The primary goal of our economic policy remains unchanged – to support people’s jobs – but the way we achieve that must evolve,” he added, acknowledging, however, “I cannot save every business, I cannot save every job,” he says.
At the heart of the new measures is a replacement for the corona virus Job Retention Scheme, which supported 8.9 million private-sector jobs at its peak in May and ends next month.
Under the new programme, support will only be available to workers whose employers keep them on at least a third of their normal hours.
“The government will directly support the wages of people in work, giving businesses who face depressed demand the option of keeping employees in a job on shorter hours, rather than making them redundant,” Sunak told parliament.
The pandemic has killed nearly 42,000 people in Britain, the worst death toll in Europe. The United Kingdom is borrowing record amounts to pump money through an economy on track for its biggest annual contraction in at least 100 years.