Retailers Next and Dixons support plan for tapered end to furlough

Next chief executive Lord Wolfson today threw his weight behind growing calls for a tapering of the government’s furlough scheme to avoid businesses going bust.

Chancellor Rishi Sunak has reportedly told Boris Johnson he hopes to prioritise keeping workers in the hardest hits parts of the economy in their current jobs.

The job retention scheme, whereby the taxpayer pays 80% of furloughed staff’s wages up to £2,500, has already been extended by a month to the end of June. There are fears companies in the hardest hit areas of the economy – including retail, events and restaurants – would have to lay off swathes of staff as trading is unlikely to return swiftly.

Wolfson said: “Government has done a very good job of supporting industry through this. People underestimate the power of the furlough scheme of the crisis it has averted…

“The idea of sector by sector furlough is extremely sensible. Some operations practically cannot open in any form if social distancing.”

Dixons Carphone chief Alex Baldock echoed the view: “We would like to see a tapering of the scheme rather than a cliff edge end to it. The British Retail Consortium is discussing that exact idea with government right now.”

Wolfson also called for clarity on the exact rules of returning furloughed staff to work, including if they decline to return, or an operation such as a warehouse, is not running at full capacity.

The company has also surveyed staff to see how many are caring for children and vulnerable people. “We will try and accommodate the hours that people can do and give people shifts they can do around childcare,” the Tory peer said.

Nearly a quarter – 24% – of its 8,794 staff are unable to work due to childcare or because they are vulnerable or are living with vulnerable people, but it hopes to get back to around 70% of its normal workforce capacity within the next two weeks.

It initially furloughed 88% of staff through the government scheme, though this figure has now reduced to 84% after opening the internet operation.