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U.K. government will pay 80% of workers’ wages to keep them employed during the coronavirus shutdown

Can the U.S. come up with anything nearly as generous?

U.K. government will pay 80% of workers’ wages to keep them employed during the coronavirus shutdown
Oxford Circus, March 20, 2020. [Photo: Leon Neal/Getty Images]

It’s a remarkable and peculiar day in Britain when it’s announced that all pubs are closing, but that ends up not being the biggest news from the country.

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Rishi Sunak, the U.K.’s chancellor of the exchequer, laid out an unprecedented plan Friday: For the first time in British history, the government will help pay workers’ wages, in response to the economic fallout from the coronavirus pandemic. The proposal would prevent the mass layoffs we’ve seen in the United States, by having the government cover 80% of the salary of every citizen who’s unable to work, up to £2,500 per month, a figure that’s just higher than the median income.

The chancellor assured the country that all employers would be eligible to apply for this relief plan for its workers, regardless of industry, size, or any other factor, and that paychecks could be backdated to March 1. “You will not face this alone,” Sunak said in the broadcast announcement. “Now, more than any time in history, we will be judged for our capacity for compassion.”

Sunak also rolled out the Conservative government’s Plan for People’s Jobs and Incomes on Twitter, highlighting other details of the package, including: an interest-free loan plan for businesses, lasting for 12 months; the wiping of value-added tax payments for businesses for a quarter; £1 billion of housing benefits for renters; and an increase in universal credit allowance by £1,000 for the year. In total, according to Sunak’s thread, the plan amounts to an infusion of more than $6 billion into the welfare system.

All this follows a £350 billion bailout package of loans and grants to help prop up British businesses, pledged by Sunak Tuesday.

There are still some holes in the economy that the plan doesn’t fill. Owen Jones, a Labour Party activist, tweeted that the announcement disregards small businesses and gig economy workers and short-changes the self-employed, who are only granted the equivalent of statutory sick pay.

Separately, Prime Minister Boris Johnson announced that all restaurants, pubs, clubs, theaters, and gyms across the country would close Friday night, a measure already implemented by many nations around the world in response to the infectious coronavirus, in efforts to promote social distancing and “flatten the curve.”

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“I do accept that what we’re doing is extraordinary,” Johnson said. “We’re taking away the ancient inalienable right of the freeborn people of the U.K. to go to the pub.”

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