Anne Marie Morris weekly column: Has furlough outlived its usefulness? | Opinion
It goes without saying that the pandemic has had a huge impact on our businesses, particularly some small businesses and businesses in the hospitality industry.
For a constituency such as ours, which is built on small and independent businesses, this has had a significant impact on so many of us.
Throughout the pandemic, I have regularly met with business and local representatives to get a feel for the issues they face so I can best represent them in Westminster (albeit mostly virtually).
One issue that has been raised recently is the impact now of the furlough scheme.
The Job Retention Scheme has been vital for employers and employees during the pandemic – but has it now run its course and outlived its usefulness?
Businesses are facing acute staff shortage problems. Businesses are back up and running but struggling to hire the staff they need.
The current plan is for furlough to continue in some form until 30 September, by which point all restrictions should be lifted and businesses allowed to open fully.
For many, furlough has been not just a lifeline but an opportunity to consider a different career, sometimes with better hours or better pay.
Some have understandably enjoyed spending more time at home and are looking again at their work/life balance – and want to change it to allow more family time.
Some employers are finding that while they have been contributing to their employees pay during furlough, their employees have, very legitimately, got second jobs and have been earning two salaries during the pandemic.
While furlough continues, the hard decisions that must be made are being delayed.
Employers are not sure whether they need to end contracts of employment or hold on to people in case things turn out better.
Employees are likewise, in some cases, unwilling to return to work, either because they no longer want to work in that job, or they have found another one but while they can earn two salaries they will.
While furlough continues these decisions will drag on – at the taxpayers' expense and at the expense of the local economy.
Some businesses simply can't open because they don't have and can't hire any staff.
This can't go on. Government needs to step in. The logical thing to do is to stop any business looking to hire new staff from continuing to furlough existing staff.
Throughout the pandemic I have been pushing for support for those directors of limited companies who pay themselves through dividends. They have received very little, if any, support throughout which is simply not right. As I have said time and again, they have done absolutely nothing wrong by paying themselves in this way.
The government has repeatedly said that support for these individuals is too difficult to administrate but this is simply a lack of will. This pandemic will have set these entrepreneurs and talented business people back and I will continue to push for support for them. If complexity is the problem – then make it a one-off lump sum.
Banks are making access to borrowing incredibly difficult for small businesses.
Banks are largely basing decisions on last year's turnover, which, of course, was significantly impacted by the pandemic. Banks are also closing many of their physical bank branches to reduce costs and to address the shift to online banking.
However, small businesses still need branches at which to deposit cash. The government need to work with regulators and the Bank of England to address this.
The Post Office is not equipped to replace business banking and a new shared multi-bank physical branch model needs to be created. Government looked at this before – they need to look at it again.
If you would like to book a virtual surgery call or raise a specific issue, please call my office on 01626 368277 or email [email protected] to arrange an appointment.
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