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MP believes £50m furlough bill for businesses is ‘absurd’

MP believes £50m furlough bill for businesses is ‘absurd’

by Henry James (June 2021)

MP Bill Esterson has commented on the new analysis by the Labour Party which has revealed the £50m bill Ministers are forcing struggling businesses to pay in July, despite the serious impact upon them of ongoing restrictions.

From July 1, businesses will be forced to contribute 10% towards the cost of furloughing employees.

This will force employers to choose between paying £122.80 on average per every employee whose job they want to protect, or removing staff from the payroll.

Also on July 1, Ministers will also begin withdrawing the 100% business rates relief for retail, hospitality and leisure businesses. That means businesses will have to contribute 34% towards their monthly business rates irrespective of their trading status.

The delay to lockdown ending is estimated to cost the economy £4.7bn.

Labour has called on the Government to:

- Delay the increased employer contribution to furlough, given that most of people remaining on furlough are employed in the sectors affected by the ongoing restrictions – hospitality, live events, accommodation and tourism.

- On business rates relief, learn lessons from the Labour-led Welsh government, which has given the vast majority of businesses 100% business rate relief for the course of this financial year. In contrast, the Conservative government is sending out bills to businesses that cannot fully open.

MP for Sefton Central, Bill Esterson, said: “Businesses in Sefton Central have done everything right over the past year, by closing up when they were told to, furloughing staff when they needed to, and supporting the communities they operate in.

“One pub in Melling even won an award for delivering thousands of free meals to local residents. Now, the average pub or restaurant will have to pay £598 per month in business rates.

“The fact that businesses are being sent massive bills after being told they can’t reopen is absurd. It will mean they won’t be able to pay staff and some may even be forced to let staff go.

“The only reason this delay has happened is because the government were slow to act on the Delta Variant, refusing to put India on the red list for three weeks. It is too late to fix that mistake, but it is not too late to give the support businesses in Sefton Central need.”

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