The Government is picking up the wage bills of close to nine million furloughed workers, who are unable to do their jobs because of the coronavirus pandemic.
Around £17.5 billion has been claimed by more than one million firms who have sent their colleagues home as the country went into lockdown in a bid to slow the spread of the deadly virus.
Government figures released today, Tuesday June 2, show that 8.7 million jobs had been furloughed as of Sunday.
This is a rise from 8.4 million a week earlier, when £15 billion had been claimed, Her Majesty’s Revenue and Customs (HMRC) said.
In March, the Government promised to pay 80% of the salaries of workers sent home because they could no longer do their jobs with public health restrictions in place.
The jobs retention scheme was designed to allow companies to keep staff on the payroll.
However, experts worry that the scheme may simply be disguising massive unemployment, with sweeping layoffs potentially on the cards after it ends.
Last week companies were told they would have to start contributing some of the pay given to employees, to slowly start weaning the economy off Government support.
In August companies will be asked to pay National Insurance and pension contributions, followed by 10% of wages in September and 20% in October as the Government reduces support.
Staff will be able to return to work part-time without losing any furlough pay from next month, the Chancellor also said.
The furloughing scheme is widely seen as having prevented millions of redundancies as the business community came to an almost complete halt for the coronavirus lockdown.
However, business groups have warned that a sudden ending of the scheme would be disastrous for many companies still unable to trade normally.
Mr Sunak said: “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.”
The figures also revealed that 2.5 million claims totalling £7.2 billion have been made under the Government scheme to support self-employed people.
Meanwhile, it emerged that UK businesses have borrowed more than £30bn from three Government-backed coronavirus loan schemes in moves to stay afloat during the crisis.
Nearly 750,000 businesses have been approved for loans worth more than £31.3 billion, according to Government data which runs up to last Sunday.
More than 963,000 businesses have asked their banks for support as part of the schemes and the figures show that £21.3 billion has been lent under the Government’s bounce back loan scheme, which is by far the most popular among businesses, with nearly 700,000 being approved.
The Government has promised to step in to pay back 100% of the loans handed out by high street lenders, such as Lloyds and Barclays, as part of the scheme.