North-east business leaders have spoken of their “relief” after the furlough scheme was extended.
The Evening Express previously revealed a lack of clarity over whether the programme would be available in full after December 2 was creating uncertainty for firms across the region.
First Minister Nicola Sturgeon said earlier this week she would have to consider whether to implement strict measures now to suppress the virus while financial support was certain.
It followed Prime Minister Boris Johnson’s repeated refusal to give assurances over whether the scheme would be continued beyond the end of England’s lockdown on December 2.
However, on Thursday, Chancellor Rishi Sunak finally confirmed furlough would be extended until March in its full form, with the Government paying 80% of the wages of employees unable to work due to coronavirus.
The scheme will be reviewed in January to determine whether more employer contributions are needed.
Further measures have also been announced, with the scope of support for self-employed people also increased in the form of further grants.
The leaders of organisations representing businesses in Aberdeen and Aberdeenshire praised the move – but admitted the announcement may have come too late to save some jobs.
Adrian Watson, chief executive of Aberdeen Inspired, said: “The extension of the furlough scheme will come as a huge relief to many of our businesses, and gives some certainty through these challenging times.
“The further increase and extension to support for the self-employed is also to be welcomed, as is the further guaranteed funding for devolved administrations. However, there are sadly still plenty of ongoing challenges. Respecting health remains the priority, the ongoing detrimental effect that the default position of working from home is having on our city centre and our retail and hospitality sectors that rely on this footfall, is one of these.
“For some, this announcement will have come too late, particularly if they were forced to make redundancies before the date indicated by government today as the cut-off to be put back on furlough.
“As with everything this year, things continue to evolve rapidly and we hope these measures will go some way to bring a slight respite locally. The knowledge that this is now in place until the spring brings with it more structured support and certainty and Aberdeen Inspired will continue to support our businesses on the ground as best we can.”
Ministers are now facing calls to put longer-term support in place to deal with the fallout from the pandemic.
Russell Borthwick, chief executive of Aberdeen and Grampian Chamber of Commerce said: “Extending the furlough scheme was a key ask of government by Chambers of Commerce so this is an important step which, in addition to the self-employed support changes, provides some much-needed clarity for businesses facing an uncertain winter.
“There are still gaps to be closed and areas where more certainly is needed however and we would like to see a commitment to providing businesses with guaranteed grants support to help the recovery.
“The only sustainable approach is management of the virus which moves towards reopening the economy. Government must set out longer-term measures over the next 12 months to give firms greater certainty and confidence to plan.”
Alix Thom, workforce engagement and skills manager at offshore body OGUK, said:
Dr Alix Thom said: “We welcome the support the Chancellor is providing today as it may provide a vital lifeline to many of our members enabling them to retain hundreds of workers in our industry whose skills and capabilities we will need to deliver deferred work, enable recovery and support our efforts in the transition to a low carbon future. Along with so many people facing continuing uncertainty due to Covid-19, our sector faces extra pressures generated by volatile oil and gas prices.
“These challenges inevitably mean recovery will take longer but we are doing all we can to support our supply chain and mitigate against further job losses. Through playing our part in delivery a green recovery, realising the full potential of the government’s North Sea Transition Deal and continued support for our industry, we can help keep energy costs low for households and families, retain jobs and create new roles for the future.”
The extension received a mixed reaction from elected representatives in the north-east.
West Aberdeenshire and Kincardine MP Andrew Bowie said: “This UK Government, this one nation Conservative government, acts for and supports people around this country, no matter what region or nation they reside in.”
Scottish Tory leader Douglas Ross added: “I have consistently made the case since the weekend that jobs here in Moray and across Scotland had to be protected at all costs.
“I am very pleased to see that the Scottish Conservative pressure has now delivered.
“Rishi Sunak has gone above and beyond. Once again, this UK Government has demonstrated it will do whatever it takes to support the country.
“Thankfully, Moray is currently at Tier One in terms of Scottish Covid-19 restrictions.
“However, businesses now know they can access the furlough scheme to help keep staff in their jobs if this support is needed.
“Across Europe we saw changes to how counties delivered their job support schemes over the summer and the UK was no different. But the UK Government was right to keep this under review as we see more restrictions introduced to get on top of the virus.
“The UK furlough scheme and support for the self-employed are amongst the most generous in the world and have been vital in protecting jobs and businesses here in Moray since the start of this pandemic.
“The Chancellor’s announcement will provide a huge amount of reassurance for any company worried about what the winter months may bring.”
However, opposition figures accused the Chancellor of only acting because lockdown measures were required in England, and questioned whether support would have been made available otherwise.
Aberdeen Central MSP Kevin Stewart said the delay in announcing the extension would cost jobs in the region.
He said: “You really have to wonder how many jobs have been lost because of this indecision and delay – while countries across Europe extended job support schemes, the UK Government resisted despite calls from opposition parties to act in the national interest and support jobs throughout the pandemic.
“It’s a very sad indictment on this so-called union of equals that it took until England required support for the furlough scheme to be extended. This change of heart is of course welcome, but it is shameful that this government only provides the medicine when the south of England gets sick.”
Aberdeen South MP Stephen Flynn added: “We’ve been crying out for an extension to the furlough scheme for months, yet we only saw the Tory Government take action when the south of England required support – it truly beggars belief.
“This screeching u-turn is welcome but just raises more questions as to why the Chancellor chose to reduce furlough support during September and October when additional public health restrictions were required in Scotland, Wales and Northern Ireland.”
Meanwhile, Ms Sturgeon said she would offer no guarantees Scotland would not eventually go back into lockdown – but said measures are not needed at this point.
Prior to Mr Sunak’s speech, ministers had been ducking questions from the press and MPs over whether furlough support would be granted to workers in Scotland, Wales and Northern Ireland beyond the end of England’s lockdown on December 2.
Shadow chancellor Anneliese Dodds slammed the uncertainty caused, saying it had cost jobs.
She said: “Businesses and workers have been pleading for certainty from this government, but the Chancellor keeps ignoring them until the last possible moment, after jobs have been lost and businesses have gone bust.
“This is the Chancellor’s fourth version of his winter economy plan in just six weeks, he can change his mind at the last minute, but businesses can’t.
“We need a Chancellor who is in front of the problems we face, not one who is always a step behind.”
The Chancellor said: “The furlough scheme was designed and delivered by the government of the United Kingdom on behalf of all the people of the United Kingdom – wherever they live.
“That has been the case since March; it is the case now; and will remain the case until next March.
“It is a demonstration of the strength of the union – and an undeniable truth of this crisis – we have only been able to provide this level of economic support because we are a United Kingdom.”