Rishi Sunak's end of furloughing will put the poorest in the greatest danger and hit the economy just as we get the second Covid 19 lockdowns

Even the right-wing Centre for Policy Studies is worried about the impact on the poor

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29 September 2020

The Centre for Policy Studies, founded by Margaret Thatcher, is about as free-market, small-state as thinktanks come. So you’d have thought it an unhappy bedfellow with the Joseph Rowntree Foundation, that famous campaigner for the impoverished.

Yet such is the CPS’s concern about the impact on poor people’s lives of the end of furlough that the pair have teamed up to demand taxpayer-funded help.

The problem they identify is that furloughing ends at the same time as compulsory mortgage holidays for those who cannot afford their payments.

A third of those in poverty own their homes and are therefore not eligible for housing benefit. They can get help on their mortgage interest, but only after nine months. And that is withdrawn if they take on any work.

Clearly, the Support for Mortgage Interest Scheme must be reformed to stop many of those about to lose their jobs from also losing their homes.

But surely there’s a simpler, faster option, too; don’t remove the furlough scheme next month. Refine and target it; clamp down on fraud, but keep it going for sectors which will bounce back.

Rishi Sunak says this is costly. But so will be the welfare bill for the extra million who’ll be laid off as a result. And that’s before you add in the consumer spending collapse among the newly jobless.

He’s offered help for part-timers and training for the jobless with no A-levels. Laudable, sure. But it will not make a scratch on an unemployment rate set for 7.5%.

As people on all sides of politics are realising, the cliff-edge end to furlough could be a costly mistake.

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Rishi Sunak

Rishi Sunak's end of furloughing will put the poorest in the greatest danger and hit the economy just as we get the second Covid 19 lockdowns

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