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The furlough scheme must not be ended now

Large sectors of the economy will continue to struggle unless the government provides assistance, says DIANE ABBOTT

THE global pandemic has taken an enormous cost in terms of lives, health and livelihoods.  

This government should have done everything it could to combat all of these, but it has failed on every count.

We are faced with the greatest pandemic to have hit the world for 100 years.  

There has been a huge death toll and far greater numbers of people have been made seriously ill, and we do not yet know the extent of the long-term consequences. 

There has also been a huge economic cost, which will probably continue to depress jobs and living standards for a long time to come.  

Government policy in this area has made matters worse, not better.

First it is important to say that government cannot control human behaviour.  

Ministers, including the Prime Minister, have repeatedly issued edicts that our children must go back to school, we should all go back to work, we should go to pubs or restaurants and we should use public transport.  

Thankfully, the common sense of ordinary people means that the vast majority of the population has refused to heed these calls.  

The teachers played a heroic role, in my view, in refusing to go back to the classroom until it was safe for them, their co-workers and above all their pupils.  

The parents and carers agreed with them, and very few beyond those in special needs or the children of essential workers who could not muster alternative childcare ever went back before the summer holidays.

If we now look around the country and see how many locations have had to move back towards lockdown, we should be grateful to all those who put safety first.  

They have undoubtedly saved thousands of lives, by defying government policy.

But the same is true to varying degrees across a wide range of social settings.  

The private consultants who monitor these areas report that pub-going is massively down on what would normally be expected and so is travel, not just on holidays but also on public transport, which is largely for work.  

Footfall in the shops is well down and reported vacancies have dropped across a range of sectors.  

The clear pattern is that, where they can avoid it, most people are too fearful to return to normal life, and others cannot.

It should be absolutely clear that the government’s reckless policies to put “the economy” first has failed even in its own terms.  

The scandalous treatment of residents and workers in the care homes shows us that this is not a government which prioritises public health.  

But it has also failed in its project to revive the economy irrespective of the public health consequences because people remain too cautious and fearful to resume their normal lives in full.

A large number of sectors of the economy will continue to struggle as along as that caution and fear are uppermost.  

And people are right to be cautious. The rate of new cases has been rising in this country since early July.

When this happened earlier in the United States, Donald Trump and his supporters dismissed it because the death toll continued to fall for a period. 

It was even claimed that the recorded new cases were only rising because testing was improving.  

None of these claims are made now. At the time of writing, tragically there are now over 1,000 new fatalities a day in the US.

Even while this government lacks common humanity, the policy of trying to get people back to work has failed spectacularly.  

Many large firms, including banks and internet giants, have already announced that they do not expect their workers to return this year, with some talking about not returning in the next 12 months.

Of course, employers of mainly white-collar workers can make their businesses function even while most people work at home.  

But many others cannot, whether it is construction, retail, manufacturing or many other sectors. They cannot operate remotely.

Some employers have responded disgracefully, either by sacking workers or threatening to sack them unless pay and conditions are cut.  

Others have lobbied government for easing of lockdown, regardless of the dangers they are placing others in.

But it is government itself which has taken the biggest lead in what amounts to efforts to force people back to work.  

The changes to the furlough scheme, firstly by insisting that firms pay 20 per cent of wages, effectively forces a choice to keep payrolls unchanged even if revenues are down, or to fire people.  

This is a gun to the head for many workers, but it is government which has provided the firearm and the ammunition.  

The situation will escalate in the run-up to October, when the furlough scheme ends entirely.

It is extraordinary that it was a recent article in the Daily Telegraph which pointed out that other countries in western Europe are not doing this.  

Equally, a recent front page of the Financial Times highlighted big businesses that were calling for the furlough scheme to be extended.  

This puts some on the same side as the TUC, which has long argued for the measure.

We do not need to dwell on why some employers want the furlough scheme extended.  

But the obvious fact that most businesses will never fully recover while they have to contend with a pandemic is inescapable.  

For their own reasons, eliminating the pandemic is recognised as crucial to many of them.

Eliminating the virus is crucial to us all. The government has done a catastrophically bad job to date. But there is no prospect of a proper return to work until they do.  

Meanwhile the government should avoid doing further economic damage and extend the furlough scheme.

Diane Abbott is Labour MP for Hackney North and Stoke Newington and was shadow home secretary from 2016 to 2020.

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