Government refuses furlough extension

A request to extend the furlough scheme for those in the travel industry has been refused by the government. The extension was requested in a  petition that attracted over 50,000 signatures.

The petition said the government’s coronavirus restrictions are disproportionately preventing the travel industry from trading properly. The government’s response was signed by HM Treasury. It acknowledged the travel industry is important to the UK economy, but said firms in the sector are able to draw upon the package of measures announced by the Chancellor, including: a Bank of England scheme for firms to raise capital, Time to Pay flexibilities with tax bills, financial support for employees and VAT deferrals.

The government said it will not be extending the Coronavirus Job Retention Scheme (CJRS).

However, it said that if sectors find themselves in ‘severe and urgent’ financial difficulties, even after its current series of measure to reduce the impact of COVID-19, then it remains open to discussions about bespoke financial support.

Its statement said: “However, the Government’s judgement has been that it would be extremely challenging to extend the CJRS for specific sectors in a fair and deliverable way, and to do so may not be the most effective or sensible means by which to provide longer term support for those sectors most affected by COVID-19.

“It would also be difficult to target the CJRS at specific sectors without creating distortions, particularly since many firms work across multiple sectors. There are other schemes including the Coronavirus Business Interruption Loan Scheme that can provide support to firms in the travel industry. Businesses in the travel industry will also be able to claim under the Job Support Scheme if they meet the eligibility criteria. More guidance will be published shortly.

“If firms across the most affected sectors find themselves in severe and urgent financial difficulties as a result of COVID-19, even following the Government‘s cross-economy wage and financial interventions, then the Government remains open to discussions about bespoke financial support but only as a last resort. Any intervention would need to be on terms appropriate to protect the interests of taxpayers.”

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