CHANCELLOR Rishi Sunak has deemed his business support schemes “among the most generous in the world” as he unveiled the next steps towards closing them down.

Last night Mr Sunak said firms would have to start contributing to furloughed employees’ wages in September, and by October they will be expected to pay 20% of their reduced salaries.

Speaking during the Downing Street coronavirus briefing, the Chancellor said: “Across the country, office lights will be turned on and windows thrown open. Work clothes and school uniforms will be pulled out of the wardrobe.

“Shops and factories will start to hum with activity...

“Our top priority has always been to support people, protect jobs and businesses through this crisis. The furlough and self-employment schemes have been a lifeline for millions of people and businesses.

“We stood behind Britain’s businesses and workers as we came into this crisis, and we stand behind them as we come through the other side.

“Now, as we begin to re-open our country and kick-start our economy, these schemes will adjust to ensure those who are able to work can do so, while remaining amongst the most generous in the world.”

He said that firms will be expected to start paying national insurance and pension contributions from August, and in September they will also be asked to pay 10% of their furloughed staff salaries. The Government will pay the remaining 70%.

The following month companies will increase their share of wage contributions to 20%, with the government decreasing its payment to 60%. After October 31, the scheme will end.

The chancellor said overall businesses using the job scheme for furloughed employees would only have to pay around 5% of what they would have paid to retain the workers if the policy had not been in place.

Mr Sunak also extended the self-employment income support scheme, which has seen 2.3 million claims worth £6.8 billion, to enable freelancers to access a second grant of up to £6570 from August. Individuals could claim up to £7500 under the first grant, which launched earlier this month.

Shadow chancellor Anneliese Dodds welcomed the extension, but said it was “concerning that there is no commitment within these plans for support to only be scaled back in step with the removal of lockdown”.

She added: “Nor is there any analysis of the impact on unemployment of a ‘one size fits all’ approach being adopted across all sectors.

“The Chancellor must publish the evidence behind these decisions to provide reassurance that his proposals won’t cause an additional spike in unemployment, and an even more difficult economic recovery from this crisis.”

The Scottish Government’s Economy Secretary Fiona Hyslop MSP said she welcomed the extension, but said: “While some employers will be able to contribute to the costs of the scheme, this cannot be a blanket approach across all employers and sectors.

“There remain some sectors that will likely still face restrictions in August, or where we know recovery will take a bit longer and “I do not think it is realistic to expect employers who continue to face these challenges to have to contribute to the scheme.

“This is a particular concern for some sectors, such as the hospitality sector, where a very large proportion of employees are currently furloughed.

“If there is not some allowance for this then this may just delay, rather than avoid, mass redundancies and business closures.”

The SNP’s Shadow Chancellor Alison Thewliss MP said the changes could push impoverished people further towards the brink.

She said: “The changes risk pushing businesses to the brink, forcing self-employed people further into hardship, and could cost countless jobs across the UK.

“Rather than restricting financial support for those impacted by the coronavirus pandemic, the Chancellor must strengthen support and fully extend the schemes for as long as is necessary to ensure a strong economic recovery.

“Workers and employers must not be penalised due to the pandemic, and moves to reduce financial assistance to businesses could end up sending unemployment soaring as they are forced to make mass redundancies or take on unmanageable debt.”

Meanwhile Alister Jack, secretary of State for Scotland said the overall package of support had kept thousands f Scots in employment since the start of the coronavirus crisis.

He said: “This extension of support for the self-employed and the further detail on the furlough scheme will provide reassurance for people and businesses across Scotland.

“These schemes form part of an unprecedented package of support which has saved many Scots from losing their jobs and seen thousands of people continue to be paid while they are unable to work.

“[The] announcement gives businesses the ability to bring people back on a part-time basis while the UK Government continues to pay the vast majority of their salary. This will be a huge help as we look to end lockdown.”