Chancellor extends furlough scheme until March

Chancellor Rishi Sunak has announced that the furlough scheme will be extended until the end of March in a statement to the House of Commons.

Over the weekend, the scheme, which was originally due to end on Saturday 31 October 2020, was extended to the beginning of December. In the original extension, employees would get 80% of their current salary for hours not worked, up to a maximum of £2,500. But employees could now work part-time and will be eligible for furlough. Under the new extension, employees will continue to receive 80% of their wages for hours not worked.

At the weekend, the ability for homeowners who are struggling financially due to the pandemic to apply for a mortgage repayment holiday was also extended. Originally, the application deadline ended on 31 October 2020, but has now been extended so that homeowners can now apply for a repayment holiday for six months. In addition to new applications, those with existing repayment holidays can top up the holiday for a further six months.

The Financial Conduct Authority (FCA) has also put forward proposals to allow consumer credit borrowers, such as those who have borrowed via credit cards or personal loans, to be granted a further six-month repayment holiday if they are facing financial difficulties due to the pandemic. This extension would include both new applications and those who have already taken out repayment holiday.