Speaking in the House of Commons today, Mr Sunak applauded the UK’s employment growth since last year.
He said: “In July last year, at the height of the pandemic unemployment was expected to peak at 12 percent.
“Today the Office for Budget Responsibility (OBR) expect unemployment to peak at just 5.2 percent. That means over two million fewer people out of work than previously feared and wages are rising. Compared to February 2020 they have grown in real term to almost three and a half percent.”
Instead, the Budget focussed on grant funding for local Governments, investing more into housing and homeownership, maximising spending for NHS and care services and provide more funding for police and crime services.
Though the scheme came to an end on September 30, 2021, many experts have spoken out about the urgent need for the furlough scheme to be reinstated at today’s Budget.
Ahead of the Budget announcement, SNP MP Ian Blackford urged the Chancellor to extend the furlough scheme “for as long as the economy is facing lockdown measures”.
He added: “These support mechanisms have to be in place because if we end up in a situation that people are unemployed, and if we end up with a situation where businesses are having to close, then we deepen the problems.
“And given the fact that Government has rightly created the circumstances of lockdown, we need to make sure that that financial support is there for people.”
Experts have also pointed to countries such as Germany, which have permanent schemes in place to shield workers during tough periods.
According to the Organisation for Economic Cooperation and Development (OECD), 23 of its member nations have such schemes in force.
Employment tax director at MHA, Nigel Morris, believes the Government should build on the “success” of the furlough scheme in order to create a “permanent scheme”.
He said: “Furlough was enough of a success that there is definitely merit in the suggestion for the creation of long-term version of it to guard against another pandemic or perhaps a major economic downturn.”
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