When Chancellor Rishi Sunak announced the furlough scheme in March last year no one would have predicted it would still be active more than 18 months later.
After supporting 11 million jobs, at a cost of almost £70 billion, the Coronavirus Job Retention Scheme ends today.
Helping pay for the cost of staff, it has kept thousands of people in jobs in Tayside and Fife.
Some workers enjoyed being on furlough, others struggled away from work.
But is it the right time for the scheme to end?
We hear from business owners who:
-
- Feel the scheme went on ‘far too long’
- Hope it pushes the Government to addressing European workers’ visas
- Think it’s ‘too sudden’ for it to end
- Have used furlough or flexi-furlough for 18 months
Furlough went on ‘far too long’
The furlough scheme was a lifeline but it went on far too long.
That’s the view of Michael Longstaffe, chief executive of Smith Anderson, one of the largest employers in Fife.
The firm makes billions of paper bags a year for the likes of McDonald’s and Burger King.
The Kirkcaldy factory faced immediate closure when Covid hit, but stayed open to make packaging for the NHS.
Around 60% of the workforce was put on furlough last April.
“Furlough was a real lifeline to companies like Smith Anderson and we should be very supportive of the Westminster Government for structuring, delivering and financing it,” he said.
“Those that went on furlough were supportive of the need and those that didn’t remained loyal, focused and did a fabulous job.”
All staff, without exception, were brought back in August 2020.
Mr Longstaffe feels the scheme should not be used as a longer-term business support tool.
“It served a critical purpose and was superb as a lifeline for so many and we will be eternally grateful,” he said.
“In my opinion it went on far too long and I suspect the fallout will be felt by us all for many years.
“If it assisted people to survive through 2020 and 2021, it has been a wonderful social endeavour, powered by a much maligned UK Government in Scotland.”
Workers’ visas main problem, not furlough ending
On a good day Crieff Hydro can make £200,000 but Covid made this fall to zero with 1,000 staff on its payroll.
The thoughts going through owner Stephen Leckie’s head before furlough was announced?
“Shock, panic, worry and fear,” he said.
“When furlough came in we were naturally relieved. Then we started to work out the figures.
“At one point we thought we were going to lose more than £6m. We ended up losing about half that.
“Did furlough protect jobs? Yes, it did.”
Crieff Hydro made around 60 redundancies last summer as the furlough scheme was due to end in October before given a last minute extension.
“We knew the October date was coming,” Mr Leckie said.
“We gave staff as much notice as we could and sadly let some go.
There were times we weren’t sure if we could survive this.
“Some staff had been with us for many years but we couldn’t afford to keep them.”
A year on, Crieff Hydro’s biggest issue is now finding enough workers, with currently more than 100 vacancies.
Mr Leckie feels it is the right time to end the furlough scheme.
He hopes it pushes governments to address the issue, felt by many sectors, of visas for European workers.
“The feedback from Government is until furlough ends, until they figure out what unemployment is, they will not talk to us about releasing workplace visas,” Mr Leckie said.
“This is our biggest issue.”
Furlough scheme should continue
Before the furlough scheme was announced hair salon owner Charlie Taylor admits she was feeling “sheer panic”.
Her biggest concern was for her 30 staff across her salons in Perth and Dundee.
She admits redundancies would have been inevitable if the scheme had not been introduced.
I think it should still be there for people who need it.
What Charlie initially thought would be two weeks of closed doors turned out to be eight-and-a-half months, unable to open for two lockdowns.
“I used every single day to add value to the business. We focused on online product sales,” Charlie said.
“We spent a lot of time communicating with the team. Everyone responded to furlough differently and some were a bit lost. We had lots of social events, like quiz nights.
“We have used flexi-furlough but less and less each month.”
So is the time right for the scheme to come to an end?
Charlie doesn’t think so.
“I have been very grateful for the furlough scheme.
“I personally think it should still be there for people who need it.
“We have a lot of new clients who appreciate our strict Covid safety measures.
“But the business is definitely not where it was pre-Covid. Some weddings are coming back but a lot of people are not going out as much.
“I feel it’s a bit sudden for it to end. But I do think we are ready to stand on our two feet and hopefully things go from strength to strength.”
Mixed emotions about furlough ending
A flurry of cancellations as Covid hit left Tricia Fox fearing the worst for Volpa, the Perth marketing company she built over almost 20 years.
She remembers hanging on to Chancellor Rishi Sunak’s every word as the Coronavirus Job Retention Scheme was announced.
“I’d never heard of furlough before but was utterly relieved that it was a viable solution to protect jobs,” Ms Fox said.
“If furlough had not been introduced, it would have been a clear cut case of having to make sweeping redundancies.”
The business made two redundancies last year as the initial October end date for furlough approached.
Volpa, which has worked on events such as The Enchanted Forest, has continued to use flexi-furlough all this year. Now all staff are returning.
“Keeping in touch with the team has been vital. The first rule of crisis management is to communicate, communicate, communicate.
Without furlough we would have had to close our doors permanently
“While I knew everyone wanted to pitch in and help in our time of crisis, people on furlough understood it was the best way to protect their jobs and the business.
“If this experience has taught me anything, it’s that humans are amazingly resilient.
“As a business we continue to build back gradually and we’re definitely now on a growth trajectory once again.”
So how does it feel now that furlough is coming to an end?
“I have mixed emotions,” Ms Fox said.
“On one hand, I’m extremely grateful for it having been there to help the business survive a unique situation.
“Without it, we would have ultimately had to close our doors permanently.
“On the other hand, I believe we’re now strong enough to stand on our own again and help rebuild our economy.”
What has the furlough scheme cost and what happens now it has ended?