Sunak’s job support boost is welcome, but nearly half a million people still face a cold winter

The chancellor has enhanced the Job Support Scheme and improved his offer for regions in tier 2 lockdown but gaps still remain, writes James Moore

Chancellor Rishi Sunak has boosted support to business amid the pandemic’s second wave (PA)

The problem with the government’s approach to the pandemic is that it seems to be engaged in playing a perpetual game of catch-up.

More than 20,000 British lives may have been saved had it been fleeter of foot when imposing the first lockdown. More may be added to the grim toll through its concentration on fighting the north’s big city mayors at the expense of the real enemy.

Chancellor Rishi Sunak is not immune from the problem. But he has proven to be quicker at the game than the rest of the ministers he sits around with cabinet table with, and that includes the prime minister. A case in point: the extension to the Job Support Scheme (JSS) he’s just announced.

In the last edition of this column I highlighted the chief flaw with the JSS, which was created to support “viable” jobs and replaced the previous Job Retention Scheme (JRS) which put millions of private sector workers on furlough.

The JSS differs from the JRS in that it requires workers to put in at least some of their hours for their employers to claim it. The problem with it was that it worked out to be cheaper for them to fire one employee and keep another on full time than it was to put a pair of them on short time hours subsidised by the scheme because of the amount employers had to pay for unworked hours. Modelling by the New Economics Foundation said Sunak could have saved 400,000 jobs by reducing that from 33 per cent to 25 per cent,  and 1.4 million by reducing it to 10 per cent.  

Sunak, who has made a habit of surprising on the upside, ended up cutting it to 5 per cent. The minimum number of hours an employee has to work has also been reduced.

In its new, more generous, iteration the JSS thus has the potential to save a lot more jobs than it previously would have.

Grants, which can be retrospectively claimed, have been made available to businesses in tier 2 lockdown, meaning government support is also now tiered just as the restrictions are.

It is all, of course, fiendishly complicated, which inevitably threatens the effectiveness of the scheme and the tiers.

Manchester mayor Andy Burnham made a fair point when he asked why the measures weren’t put on the table on Tuesday, during the fraught negotiations he was conducting with central government that ended with his city told it was being forced into the tier 3 with little more than a couple of sweets long past their best before date in terms of support.

It would have spared the government a serious headache and an ocean of bad PR. It might just be me, but Boris Johnson and his chums do sometimes seem to be remarkably bad at day to day politics.

Back to the scheme. It bears repeating that while Sunak might be a good deal quicker on the uptake his colleagues, thousands of jobs were still lost during the time it has taken him to charge up his scheme. And even now he’s done that, it still contains gaps.

There are 450,000 potentially viable roles (per the foundation’s numbers) that will, for example, be left unprotected.

It should also be remembered that people subsidised through the JSS may still find themselves on just two-thirds of their wages compared with the 80 per cent available under the JRS.

That matters, particularly if you consider the plight of low-paid workers.

They may have just about been able to survive a 20 per cent cut when on furlough but a 33 per cent reduction will inevitably push some over the edge.

Mr Sunak has done the right thing by acting. But he only deserves two cheers this time because he’s still left an awful lot of people facing an awfully cold winter.