Rishi Sunak to launch ‘Winter Economy Plan’ to help stop a ‘tsunami’ of job losses in coming weeks

Chancellor Rishi Sunak is set to unveil an emergency Covid-19 rescue plan that aims to protect jobs. 

Following warnings from MPs and unions, the chancellor has ruled out the autumn budget and will instead launch a ‘Winter Economy Plan’, Sky News reports.

To help the economy cope with the latest restrictions, including 10pm curfews on pubs and restaurants and office staff told to work from home, the scheme will be centred around a multi-billion-pound package. 

Modelled on a similar scheme in Germany, the scheme will subsidise wages of workers who are returning to work part-time after being furloughed. 

It is also expected that the VAT cut to 5% will be extended until the end of March rather than January. 

Those hard-hit businesses are also likely to see the extension of four loan schemes until the end of November, which include terms increased from six to 10 years to reduce monthly repayments.

Mr Sunak spoke of the unusual step to not announce a November Budget because ‘now is not the right time to outline long-term plans and people want to see us focused on the here and now’.

A source told Sky News: “No-one wanted to be in this situation but we need to respond to it. The chancellor has shown he has been creative in the past and we hope that people will trust us to continue in that vein.

“Giving people reassurance and businesses the help they need to get through this is uppermost in his mind.”

They added: “It is not about health versus the economy, but about the balance between keeping people in jobs and finding them new ones, and that ‘what remains true is that our priority is one word: jobs’.”

The Treasury explained that the chancellor is promising a ‘flexible and adaptable approach to economic support, because people have needed the help and they’ve needed it quickly and at the right time’. 

Adding that he will be ‘very honest with people’ about the trade-offs the government faces as it deals with rising infection rates and an economic slump. 

Shadow chancellor Anneliese Dodds told Sky News that Labour has been: “saying for a very long time that it’s critical we have a targeted system of wage support in place”.

Dodds added: “I’ve called for that 40 times and 20 times the government has said they’re not willing to put that into place.

“Obviously, if the government has shifted, I’m pleased. It’s come very late, however. We’ve already seen a number of redundancies because of the one-size-fits-all withdrawal of the furlough scheme.”

The Prime Minister told MPs: “What we will do is continue to put our arms around the people of this country going through a very tough time and come up with the appropriate creative and imaginative schemes to keep them in work and keep the economy moving.”

Labour MP Grahame Morris demanded an expansion of the Covid Job Retention Scheme, saying: “Make no mistake: a tsunami of job losses is in the pipeline within 38 days.”

Labour leader Sir Keir Starmer warned of a ‘wave of job losses in the winter’ because ‘it makes no sense to bring in new restrictions at the same time as phasing out support for jobs and businesses’.

The shop workers union also warned of ‘a tsunami of job losses’.

General secretary Paddy Lillis added: “If we are going to save the high street, there needs to be radical and bold action to level the playing field between online retail and ‘bricks and mortar’ shops.

“The time is long overdue for the government to look seriously at introducing some form of online sales tax.

“As a society we have a choice, do we want to see the high street go to the wall or do we want to save it.

“Retail is the cornerstone of our towns, cities and communities. It employs around three million people and needs urgent assistance to get the industry back on its feet.”