The Job Support Scheme is the new scheme introduced by the Chancellor of the Exchequer Rishi Sunak to help curb the “tsunami of job losses” in the aftermath of the coronavirus crisis. The furlough scheme has cost the UK around £40 billion, instead of an estimated £500 million for the new Job Support Scheme. Express.co.uk has compiled a guide to explain the differences in the UK scheme from the German scheme.
What is Rishi Sunak’s Job Support Scheme?
Mr Sunak’s Job Support Scheme announced on Thursday, September 25 aims to support workers which will replace furlough when it closes on October 31.
The scheme begins on November 1 running for six months, topping up workers’ wages when companies cannot take employees back on a full-time basis.
Workers must undertake at least one-third of their usual working hours and the unworked hours, the cost will be split between the Government and employer – each paying a third.
All businesses are eligible for the scheme, but larger firms can also claim it if they can prove the business has been affected by the pandemic.
The Government’s contribution amount is capped at £697.92 a month.
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What is German’s “Kurzarbeit” scheme?
Germany’s Kurzarbeit scheme is a short-time work benefit scheme which came into its own during the financial crisis of 2008/2009.
The programme enables businesses to reduce workers’ hours and apply to the Government to have their wages subsidised.
Before the coronavirus pandemic, the German Government would cover 60 percent of an employee’s lost salary or 67 percent for someone with children.
But amid the crisis, this has now risen to 80 percent.
The second difference is that the employer is not required to pay social security measures for hours not worked in Germany.
However, in the UK, the employer must pay the full national insurance and pension contributions, both for hours worked and not worked.
The Government contributed towards these costs for their contributions on the furlough scheme, but will no longer do so on the Job Support Scheme.
The third key difference is that for people on the Kurzarbeit scheme for a longer period of time, the German subsidy increases if people in Germany lose at least their income.
People on the scheme will be on 60 to 70 percent after four months with it rising to 80 percent after seven months.
The amount will rise to 87 percent for people with children.
However, in the UK claimants will be able to claim a flat rate of 66 percent up to a cap of £697.92.
In addition, another key difference is that the Kurzarbeit scheme will be available for claimants for 24 months, compared to just six months for the Job Support Scheme.
