Fears for thousands of furloughed staff in Harrogate as jobs scheme comes to an end
There are fears for the jobs of around 3,600 workers in the Harrogate district who remained on the furlough scheme when it ended last week.
The government scheme first introduced at the start of the Covid outbreak has protected millions of jobs during the pandemic, with Harrogate and Knaresborough MP Andrew Jones saying it "got our country through the darkest days of the lockdown".
But Liberal Democrat councillors in the district are warning that businesses and employees could now be hit by a "tidal wave of job losses" unless more support is made available.
Councillor Pat Marsh, leader of the opposition group on Harrogate Borough Council, said the Liberal Democrats both locally and nationally are demanding that the scheme is extended for businesses hit hardest by the pandemic.
She said: "The withdrawal of furlough risks having a devastating impact on at least 3,600 people in the Harrogate area who are already facing a winter of soaring energy bills and cuts to benefits.
"Supporting them and their families is both the right and responsible thing to do.
"Although many may find work in recovering sectors such as hospitality and travel, there is also likely to be a rise in unemployment due to new redundancies as businesses fail without the support of furlough."
Some workers who relied on furlough are also now facing the added worry of the end of the £20-a-week boost to Universal Credit.
This temporary increase to payments was introduced in response to the pandemic and officially ends tomorrow, 6 October.
Citizens Advice has described this as a "disastrous decision” by the government and warned around 1.5million claimants across the UK could be pushed into hardship this winter.
Dame Clare Moriarty, chief executive of charity, said: “Shop workers, nursery assistants and security guards are just some of the people on Universal Credit seeking our help because they’re already struggling to make ends meet."
Under the furlough scheme, around 28,600 jobs in the Harrogate district were supported during its 18-month course.
It saw the government pay around £70billion towards the wages of employees across the UK who could not work, or whose employers could no longer afford to pay them, up to a monthly limit of £2,500.
At first it paid 80% of their usual wage, but in August and September it paid 60%, with employers paying 20%.
Since its end, Chancellor Rishi Sunak has pledged more than £500million in fresh funding to help people back into work and support sectors which are facing recruitment crises.
Funding for the new packages will not be set out until later this month and it comes at a time when Mr Sunak and Prime Minister Boris Johnson are facing pressure to ease the historically high tax burden.
Harrogate and Knaresborough MP Andrew Jones said while now was the right time for furlough to end, the extra funding showed the government was willing to continue its support for jobs during the Covid recovery.
He added: “The furlough scheme is estimated to have cost £70bn and this will need repaying. But the human and financial cost of letting industries, businesses and jobs go to the wall during lockdown would have been catastrophic.
"It is going to be a bumpy road ahead even so but without the actions that were taken it is difficult to imagine what the situation would have been.”
By Jacob Webster, Local Democracy Reporter