Nicola Sturgeon fears Scotland faces financial ruin as Sunak rules out furlough extension

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The First Minister called on the Treasury to extend the financial support for workers and businesses which currently supports 650,000 Scots. The scheme is due to come to an end in October but it will start being scaled back from August with companies expected to pay a higher share of wages while the UK government continues to subsidise 60 percent of salaries up to cap of £2,500 a month.


Speaking at the Scottish Government’s daily coronavirus briefing, she said the figures released on Friday which showed the UK economy fell by more than 20 percent in April “confirms the scale of the economic crisis that has inevitably been caused by the health crisis we face”.

Ms Sturgeon added: “I have previously welcomed the UK Government’s interventions, especially the furlough scheme which has helped to preserve jobs during this period.

“But in my view it is now time to signal a further extension of Treasury support.”

She stressed other countries such as France had already made the move.



The SNP leader continued: “The alternative to extended support being put in place is either that businesses are forced to reopen before it is safe to do so, and that of course could damage health and it could cost lives, or businesses will have to take an even bigger hit and that will cost jobs.”

But Mr Sunak said that it was “not sustainable” to carry on with the furlough scheme.

Speaking on the BBC’s Andrew Marr show yesterday, Mr Sunak added: “The furloughing scheme has protected around nine million jobs, a million businesses, two and a half million self-employed people.

“Those are the right things to do and the situation would be far worse if we hadn’t done that.

“It’s not sustainable to carry on doing that. I think actually there’s a general consensus about that across probably the political and economic spectrum.

“It will run in total for eight months, which I think is a generous period of time to provide support.”

However, Scottish Economy Secretary Fiona Hyslop warned: “If the UK Government continues to reduce support, it is important that there’s continued recognition that public health guidance is devolved and so progress in easing the lockdown may be different in each nation.”

Her colleague, Scotland’s Finance Secretary Kate Forbes, also called for more powers to be given to the Scottish Government to set taxes.

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She warns there was a £500million hole between the extra cost of the COVID-19 pandemic and the funding given to Scotland from Westminster.

Ms Sturgeon added the Scottish Government wants to “work constructively” with the UK Government on the issue, adding when figures are published on Scotland’s labour market on Tuesday they are likely to show an impact on jobs caused by the COVID-19 pandemic.

So far, 870 patients are currently in Scottish hospitals with coronavirus with the total number of deaths staying at 2,248 after none were recorded in the last 24 hours.

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