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UK Chancellor prepares for wage boost to his Covid-19 rescue package

Press Trust of India  |  London 

UK Chancellor of the Exchequer Rishi Sunak, who had pledged to do whatever it takes to save people's jobs and livelihoods through the coronavirus pandemic, is preparing to unveil a further wage boost to his Covid-19 rescue package on Friday.

The UK's Indian-origin finance minister had already tabled an estimated 350-million pounds loan and grants package to assist struggling businesses through the crisis.

On Thursday, he held further roundtables to work out an employment and wage subsidy package to try to protect millions of jobs.

Business groups and union leaders held late night discussions with the Chancellor to push for help to pay wages and prevent businesses from collapsing and wiping out thousands of jobs.

We are working round the clock to deliver further support to individuals and families whose jobs and incomes will be affected by Covid-19 and to do so urgently, said Sunak, in reference to his latest set of meetings.

We are in this together, and will all have to play our part, he said. During his weekly briefing from Downing Street on Thursday, British Prime Minister Boris Johnson had indicated that Sunak was working on further help to be announced on Friday as he urged struggling businesses to "stick by their employees, because we're all going to need them".

Carolyn Fairbairn, Director-General of the Confederation of British Industry, said: Firms will do all they can to help employees through these unprecedented times. But the exponential growth of the economic impact requires an urgent, bold new approach to protect pay and livelihoods.

The Chancellor's commitment to go further, at speed is right together we must deliver it within days, not weeks. The UK government said it has already announced expansions in eligibility for welfare support and a hardship fund to support the most vulnerable, as well as support to businesses to help with cash flow and paying wage bills.

As well as providing emergency support to business, it is essential that money goes into workers' pockets now. We must do whatever it takes to stop businesses going to the wall and workers being plunged into poverty, said Frances O'Grady, General Secretary of the Trades Union Congress.

Mike Cherry, National Chairman of the Federation of Small Businesses, added: It's vital that money is available on the front-line now. We have seen an escalation in the health response; now it is right for there to be an escalation in the economic response.

One proposal said to be under discussion is for the UK to follow the lead of countries such as Denmark, where the government has promised to cover 75 per cent of salaries at private companies for three months, if they promise not to let staff go.

The Bank of England has cut interest rates twice in a little over a week to try to provide support to the UK economy, while lenders are preparing to offer a three-month mortgage holiday to homeowners in financial difficulty due to the virus.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, March 20 2020. 17:48 IST