London Daily

Focus on the big picture.
Thursday, Jul 10, 2025

UK's Rishi Sunak expands help for some lockdown-hit firms as recovery wanes

UK's Rishi Sunak expands help for some lockdown-hit firms as recovery wanes

A resurgence of the pandemic has forced Prime Minister Boris Johnson to consider new containment measures and is threatening to derail an economic recovery that has already started to wane

British finance minister Rishi Sunak took fresh steps on Friday to try to stave off a surge in unemployment, offering extra help for businesses and people who are forced to stop work during local coronavirus lockdowns.

In a move likely to cost billions of pounds over the six-month duration of the new scheme, Sunak said the government would pay up to two-thirds of employees' salaries, capped at 2,100 pounds ($2,725) a month each, if they work for companies that are forced to close temporarily.

A resurgence of the pandemic has forced Prime Minister Boris Johnson to consider new containment measures and is threatening to derail an economic recovery that has already started to wane.

Data published earlier on Friday showed Britain's economy grew in August at its slowest pace since May, when it started to recover from a record slump caused by a nationwide lockdown in late March and April.

Sunak, whose emergency spending measures were already on course to cost about 200 billion pounds and push the budget deficit to its highest since World War Two, had resisted calls to increase the generosity of his wage support schemes.

His announcement on Friday could herald the temporary closure of bars and other businesses. There are around 2.5 million jobs in the hospitality sector.

Pubs across England, Wales and Scotland were forced to close early from last month. Scotland's government has since ordered a 16-day closure of pubs in the country's two biggest cities, starting on Friday.

"I hope that this provides reassurance and a safety net for people and businesses in advance of what may be a difficult winter," Sunak said.

ECONOMIC OUTPUT


A Treasury source said the new wage support measures, which will last for six months from Nov. 1, were likely to cost hundreds of millions of pounds a month.

The programme is a partial replacement for Sunak's flagship, economy-wide furlough programme which closes at the end of this month and is estimated to have cost around 50 billion pounds.

Under the new scheme, which was welcomed by Britain's main employer groups, companies will not be required to contribute towards wages and must only cover social security and pension contributions.

The move to expand the Job Support Scheme - itself announced only two weeks ago - means furlough-type help will remain available to companies that find themselves completely closed by future lockdowns.

However the programme will not help businesses that face new restrictions which fall short of complete closure, or which are suppliers to firms that are closed down.

"The big question still remains whether he will pull a rabbit out of the hat for those businesses who do not meet the criteria of being required to close but do not have work for staff to do," said Ruth Buchanan, a partner at law firm Ashurst.

Britain's events industry, which warned last week of 90,000 job losses when the existing furlough scheme ends, said it was urgently seeking clarity on whether its members could get help.

Torsten Bell, chief executive of the Resolution Foundation think tank, welcomed Sunak's new measures but questioned why it took so long. "The delay in putting it in place will have come at a high price in jobs lost," Bell said.

The opposition Labour Party said earlier the government had lost control of the virus, harming the economy in the process.

"It's been clear for weeks that areas under local restrictions needed more support," said Anneliese Dodds, Labour's finance spokeswoman.

An official estimate on Friday showed the average daily number of COVID-19 cases in England had doubled in a week.

Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
NVIDIA Achieves Historic Milestone as First Company Valued at $4 Trillion
Declining Beer Consumption Signals Cultural Shift in Germany
Linda Yaccarino Steps Down as CEO of X After Two Years
US Imposes New Tariffs on Brazilian Exports Amid Political Tensions
Azerbaijan and Armenia are on the brink of a historic peace deal.
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Weinstein Victim’s Lawyer Says MeToo Movement Still Strong
U.S. Enacts Sweeping Tax and Spending Legislation Amid Trade Policy Shifts
Football Mourns as Diogo Jota and Brother André Silva Laid to Rest in Portugal
Labour Expected to Withdraw Support for Special Needs Funding Model
Leaked Audio Reveals Tory Aide Defending DEI Record
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
London Stock Exchange Faces Historic Low in Initial Public Offerings
A new online platform has emerged in the United Kingdom, specifically targeting Muslim men seeking virgin brides
Trump Celebrates Independence Day with B-2 Flyover and Signs Controversial Legislation
Boris Johnson Urges Conservatives to Ignore Farage
SNP Ordered to Update Single-Sex Space Guidance Within Days
Starmer Set to Reject Calls for Wealth Taxes
Stolen Century-Old Rolls-Royce Recovered After Hotel Theft
Macron Presses Starmer to Recognise Palestinian State
Labour Delayed Palestine Action Ban Over Riot Concerns
Swinney’s Tax Comments ‘Offensive to Scots’, Say Tories
High Street Retailers to Enforce Bans on Serial Shoplifters
Music Banned by Henry VIII to Be Performed After 500 Years
Steve Coogan Says Working Class Is Being ‘Ethnically Cleansed’
Home Office Admits Uncertainty Over Visa Overstayer Numbers
JD Vance Questions Mandelson Over Reform Party’s Rising Popularity
Macron to Receive Windsor Carriage Ride in Royal Gesture
Labour Accused of ‘Hammering’ Scots During First Year in Power
BBC Head of Music Stood Down Amid Bob Vylan Controversy
Corbyn Eyes Hard-Left Challenge to Starmer’s Leadership
London Tube Trains Suspended After Major Fire Erupts Nearby
Richard Kemp: I Felt Safer in Israel Under Attack Than in the UK
Cyclist Says Police Cited Human Rights Act for Riding No-Handed
China’s Central Bank Consults European Peers on Low-Rate Strategies
AI Raises Alarms Over Long-Term Job Security
Saudi Arabia Maintains Ties with Iran Despite Israel Conflict
Musk Battles to Protect Tesla Amid Trump Policy Threats
Air France-KLM Acquires Majority Stake in Scandinavian Airlines
UK Educators Sound Alarm on Declining Child Literacy
Shein Fined €40 Million in France Over Misleading Discounts
Brazil’s Lula Visits Kirchner During Argentina House Arrest
Trump Scores Legislative Win as House Passes Tax Reform Bill
Keir Starmer Faces Criticism After Rocky First Year in Power
DJI Launches Heavy-Duty Coaxial Quadcopter with 80 kg Lift Capacity
U.S. Senate Approves Major Legislation Dubbed the 'Big Beautiful Bill'
Largest Healthcare Fraud Takedown in U.S. History Announced by DOJ
×