The furlough wage support scheme looks likely to be extended in Wednesday’s Budget, according to the secretary of state for business.
The Job Retention Scheme is due to stop at the end of April but there has been widespread speculation that the chancellor will keep it beyond that date.
Asked on BBC Breakfast if the furlough scheme would continue, business secretary Kwasi Kwarteng said the chancellor had “already indicated that we will be extending furlough”.
He told BBC Radio 4’s Today programme: “I think it’s a fairly good assumption that, while lockdown persists, there will be additional support.
“In order to keep people’s jobs going… to keep companies going, we need to continue providing support.”
The prime minister’s roadmap for easing Covid restrictions says the final legal limits on social contact and business activity will end no earlier than June 21.
Trade bodies such as Abta have been lobbying the government for continued financial support for the sector – and now the TSSA union is calling for “crystal clear measures to support our travel trade”.
General secretary Manuel Cortes commented: “Without a Budget support package there may not be a high street travel industry left. It’s that simple.”
Elsewhere, the Conservative MP for Elmet & Rothwell called for furlough and other financial support to continue because of the challenges faced by travel.
Good to see MPs like @AlecShelbrooke highlighting the value of travel and urging the #Chancellor to provide extended support to the travel industry ahead of the #budget this Wednesday, recognising the unique challenges the sector is facing. #SaveFutureTravelpic.twitter.com/JRFObeP4nD
— ABTA Members (@ABTAMembers) March 2, 2021
Speaking in the House of Commons last week, Alec Shelbrooke highlighted how the travel agency sector depends on factors beyond its control such as foreign border restrictions.
“The biggest concern is, if it is to open when other non-essential shops open…it does not have anything to sell,” he said.
“Just three examples from my constituency of travel agents: going from £4 million turnover to zero; a £2.3 million turnover and £300,000 gross profit to £7,000 loss; and £1-£1.2 million turnover with a 15% profit down to a £4,000 loss.
“Staff have been furloughed but there are fixed costs and…business owners aren’t earning a single penny.”
He said travel employs more than the automative sector, adding: “They are struggling to get CBILS [Coronavirus Business Interruption Loan Scheme] loans because they have not got any revenue coming to meet the criteria that the banks want.
“We really have to ensure that we support this sector and carry on business grant support, business rates relief and the furlough scheme.
“It could be three or four months after June that they’re actually in a position to earn a living and sell products.”
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