Chancellor Rishi Sunak’s decision to extend to October the government’s furlough scheme to support UK businesses during the Covid-19 pandemic has been welcomed by the Association for Consultancy and Engineering (ACE) as a significant contribution to restoring confidence to the construction sector. 

ACE led the construction industry taskforce that proposed the changes to the furlough scheme that the chancellor announced yesterday as it was clear that a significant part of the construction industry was dependent on the current scheme. A survey of the industry found that 84% of the industry was using the scheme with 48% of companies furloughing more than 50% of staff. 

In addition, 80% of the industry stated that the decline in work volumes had forced them to furlough large numbers of staff and that without the government's support they would be faced with the prospect of having to make large scale redundancies. 

Although the scheme will continue, the chancellor will look to industry to help with the cost of 80% of an employee’s earnings and there are also plans to make the scheme more flexible by allowing employees to continue to work while on the scheme. This change will allow employers to develop their corporate plans while protecting jobs and allowing the government access to the skills and talent it needs to deliver its domestic agenda.  

ACE chief executive Hannah Vickers said: “I am delighted that the chancellor has agreed to extend and introduce flexibility to the furlough scheme, as proposed by the CLC and ACE on behalf of the industry, as this will provide confidence to both employers and workers that they will no longer face a cliff edge in June. 

“This new  part-time furloughing scheme is in everyone’s interests as it allows companies to bring back more staff on a rota and prevent steep cuts to employment while limiting the cost to the taxpayer. We will await the full details of how the scheme will be implemented in due course, but it’s the right headline commitment from the government.”