(Bloomberg) — The U.K. Treasury has no plans to revive the furlough program to protect jobs put at risk by the government’s latest curbs to contain the omicron variant, according to a person with knowledge of the matter.
As long as there is no directive for businesses to close, authorities will not restart the flagship program, the person said on condition of anonymity.
The Trades Union Congress and affected companies have asked for furlough relief after Prime Minister Boris Johnson told people work from home where they can, said so-called Covid passports will be required for big events and made masks compulsory in indoor public spaces.
Hospitality and leisure companies based in city centers said they will struggle as workers stay away in the busy build-up to Christmas. Airlines are also losing bookings.
Furlough ended on September 30, having protected 11.7 million jobs at a cost of 70 billion pounds ($92 billion). In a statement on Wednesday night, the Treasury signaled that the remaining measures were sufficient.
The CBI, Britain’s biggest business lobby group, backed the Treasury’s decision to keep the wage-protection program closed but made the case for more targeted business support.
“Now does not feel like the right stage to reopen furlough,” Rain Newton-Smith, chief economist at the CBI, said in an interview.
“One of the biggest challenges for businesses across the country is finding people to grow their business, so it is right to keep the focus on allowing people to move between roles, not encouraging them to remain with their employer.”
She said any support “needs to be targeted at the businesses in the firing line; aviation, leisure, live events.”
Hospitality and leisure companies are paying a reduced rate of VAT, down from 20% to 12.5%. They can also claim two thirds business rates relief until the end of March and are eligible for 50% business rates relief worth up to £110,000 next year.
Local authorities have grant money that they can distribute to struggling businesses. The combined package is worth several billion pounds.
The Treasury said its current support package “will continue to help businesses into spring next year and we will continue to respond proportionately to the changing path of the virus.”
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