But chancellor not expected to extend furlough scheme that is still supporting nearly 300,000 construction jobs

Chancellor Rishi Sunak is today expected to unveil a package of support measures for businesses designed to protect jobs as the coronavirus health crisis intensifies over winter.

However, the chancellor is not expected to give in to opposition calls for him to extend the existing “furlough” scheme under which employees are given a government subsidy to stay at home and paid 80% of their wages.

Sunak summer budget

Instead, Sunak (pictured left) is expected to launch a “winter economy plan” which will extend business loan support schemes, and include plans for a wage subsidy programme, topping up income for those asked to worked reduced hours.

The scheme is apparently based on a similar such programme in Germany, named kurzarbeit, which means “short working”. This could disappoint those in the worst affected sectors, such as travel, the arts and hospitality, who have campaigned for more drastic interventions.

According to the latest government figures, there were still 277,000 construction workers on furlough at the end of July, albeit sharply down from the peak of over 700,000 in April.

The furlough scheme, which has cost the government £37bn, is due to close at the end of October.

Speaking in advance of Sunak’s address, expected at 12.30 today in parliament, health secretary Matt Hancock told the BBC that the government was not going to be able to protect “every job and business”, and that the government’s strategy was “to suppress the virus until the vaccine and a full solution comes along.”

He told the Today Programme: “We’re going to continue to support the economy as much as we can. We’re not able to protect every job and every business. We’re trying to put in the absolute maximum support that is possible.”

Prime minister Boris Johnson yesterday told the House of Commons that Sunak would unveil “creative” proposals to give “people reassurance and businesses the help they need to get through this”.

The expected wage subsidy scheme is designed to allow companies to keep workers on in jobs with a future while ensuring that others are not retained in so-called “zombie posts”. According to reports there is also expected to be some support for the hardest hit sectors, though it is not known if construction, which has started to recover after being initially very severely hit, will be included in that.

However, Labour leader Keir Starmer yesterday used a televised national address to criticise plans to end furlough, saying it was “a huge mistake” which could “lead to a wave of job losses this winter.”