Andy Burnham was wrong about furlough on Question Time
13th Oct 2020
People working in restaurants and bars in Bolton that were closed because of local Covid-19 restrictions could not access any support.
This is not correct. During the local restrictions in Bolton, businesses were still able to make claims through the furlough scheme on behalf of employees who had already been furloughed for at least three consecutive weeks before July.
During an appearance on Question Time on 8 October, the Mayor of Greater Manchester Andy Burnham was involved in a debate with skills minister Gillian Keegan about furlough.
Mr Burnham argued that people working in pubs and restaurants in Bolton that had to be suddenly closed because of Covid-19 could not access any support, while Ms Keegan insisted they could have used the furlough scheme.
It’s possible that some hospitality workers affected by recent restrictions would not have been able to access support, but it was misleading for Mr Burnham to suggest that none would have been able to access furlough payments.
The debate went as follows:
Andy Burnham: Gillian, can I ask you a question? You closed pubs and restaurants in Bolton overnight just a few weeks ago, but the people who worked behind the bar in those places or in the kitchen got no support at all. Do you think that is right?
Gillian Keegan: Well the people would be entitled to furlough.
AB: No, they weren’t.
GK: Why were they not entitled to furlough?
AB: Because it was closed overnight. Their jobs were just taken away from them overnight.
GK: Well their employers could have put them into furlough. That is exactly what that scheme is there for. […]
AB: Honestly Gillian, people working behind bars can’t be put easily into furlough schemes.
GK: But they were put into furlough schemes, all across the country.
AB: The point you’re missing is we’ve been under restrictions, local restrictions, without support and that’s happened all summer. […]
GK: For some reason, Andy, you seem to not have realised that the furlough scheme that we put in place in March, which is still in place today, which we spent £40bn on has also applied-
Fiona Bruce: But it’s closed Gillian, which I’m sure you know in your job, it’s closed to new entrants.
GK: Yes but, it’s at the end of this month, but it’s been there all this time.
AB: It closed to new entrants. The Bolton staff could not access that scheme.
FB: It closed on 30th June.
Following this exchange, Labour MP Carolyn Harris tweeted: “Government Minister on #bbcqt doesn't know the furlough scheme closed to new applications in JUNE. Claims businesses forced to close in local lockdown areas can furlough staff until end of month. No they can't. Good grief.”
However, this is not correct.
The Coronavirus Job Retention Scheme began in March, and allowed employers to claim money to cover the wages of employees placed on temporary leave (furlough) due to the coronavirus pandemic. The government initially agreed to pay up to 80% of the wages of furloughed staff, up to £2,500 a month.
From 30 June, furlough payments remained available to anyone who had previously been furloughed for at least three consecutive weeks at any time before this date, but closed to employees who did not meet these criteria (with some exceptions, for employees returning from parental leave).
Employers were still able to claim for the maximum number of employees they had previously claimed for. Employers were also given the ability to flexibly furlough employees after this date, so that staff could work fewer or different hours to usual and still claim for the hours they did not work compared to usual.
From 1 August the level of government support began to reduce each month, with the government paying 70% of wages, up to £2,187.50 in September and 60% of wages, up to £1,875 a month, in October. During this period, employers were expected to top up the wages to at least 80%.
Restrictions for Bolton, published on 9 September and withdrawn on 3 October, stated that all hospitality venues including pubs, bars and restaurants could only provide takeaway food and drinks or delivery services to customers.
As discussed above, the furlough scheme closed to new entrants on 30 June, but as hospitality venues had to be closed earlier in the pandemic it is very likely that employees in pubs and restaurants in Bolton would have previously been furloughed. This means they would still be eligible for furlough until the end of the scheme, although at the lower level of support.
While the furlough scheme was due to finish completely on 31 October, on 9 October - the day after Question Time was broadcast - the Treasury announced that the support would be expanded for businesses who are legally required to close because of coronavirus restrictions. This will come into force from 1 November.
The government will pay 67% of eligible employees’ salaries (up to £2,100 a month), and businesses required to close in local lockdowns can receive grants of up to £3,000 a month.
However, under this scheme employers will not be expected to contribute to the wages of employees, leaving staff receiving two thirds of their normal pay rather than 80% (although they could choose to pay furloughed employees on top of the support, and will have to pay their employees’ national insurance and pension contributions).
Some northern mayors have expressed concern about the low level of pay some staff will receive, especially those in often already low-paid jobs in the hospitality sector.