It has been announced the furlough scheme will be extended by a further four months with workers continuing to receive 80% of their current salary.

From the start of August, furloughed workers will be able to return to work part-time with employers being asked to pay a percentage towards the salaries of their furloughed staff.

The employer payments will substitute the contribution the government is currently making, ensuring that staff continue to receive 80% of their salary, up to £2,500 a month.

Chancellor Rishi Sunak said: “Our Coronavirus Job Retention Scheme has protected millions of jobs and businesses across the UK during the outbreak – and I’ve been clear that I want to avoid a cliff edge and get people back to work in a measured way.

This extension and the changes we are making to the scheme will give flexibility to businesses while protecting the livelihoods of the British people and our future economic prospects.”

New statistics published today revealed the job retention scheme has protected 7.5 million workers and almost 1 million businesses.

The scheme will continue in its current form until the end of July and the changes to allow more flexibility will come in from the start of August. More specific details and information around its implementation will be made available by the end of this month.

The government will explore ways through which furloughed workers who wish to do additional training or learn new skills are supported during this period. It will also continue to work closely with the Devolved Administrations to ensure the scheme supports people across the Union.

The Chancellor’s decision to extend the scheme, which will continue to apply across all regions and sectors in the UK economy, comes after the government outlined its plan for the next phase of its response to the coronavirus outbreak.

The scheme is just one part of the government’s world-leading economic response to coronavirus, including an unprecedented package for the self-employed, loans and guarantees that have so far provided billions of pounds in support, tax deferrals and grants for small businesses.

Today the government is also publishing new statistics that show businesses have benefitted from over £14 billion in loans and guarantees to support their cashflow during the crisis. This includes 268,000 Bounce Back Loans worth £8.3 billion, 36,000 loans worth over £6 billion through the Coronavirus Business Interruption Loan Scheme, and £359 million through the Coronavirus Large Business Interruption Loan Scheme.

Scott Knowles, Chief Executive of East Midlands Chamber (Derbyshire, Nottinghamshire, Leicestershire), said: “Businesses will welcome the further extension of the Coronavirus Job Retention Scheme beyond June, which will help eliminate some of the uncertainties that businesses and their employees are still facing.

“The potential to keep the scheme running to October, albeit with employers contributing, will help to aid the transition back to work, while allowing flexibility to bring people back into the workplace on a part-time basis, where it is safe to do so, is also something we’ve been campaigned for.

“The furlough scheme has seen the Government provide an unprecedented level of financial support to workers affected by the pandemic with the objective of protecting jobs and businesses, for which it should be applauded.

“However, such a huge financial commitment is not sustainable over the long-term, which is why the focus now needs to shift more towards safely restarting the economy as quickly as possible so businesses can start the process of building the UK’s economic recovery, which is the best – and most sustainable – way of securing people’s livelihoods.”

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