The Chancellor has turned his back on millions of struggling workers excluded from coronavirus support schemes, despite his pledge that no one would be left behind, an influential group of MPs has said.
The Treasury Select Committee, which scrutinises the Chancellor, made a series of recommendations in a recent report aimed at bringing those still suffering financial hardship within the scope of the protection measures.
More than a million people have been unfairly left without help, the report found, including those moving between jobs who missed the cut-off for furlough, the newly self-employed, directors who pay themselves in dividends and PAYE freelancers.
Campaigners have said as many as three million people have fallen through the cracks, left without an income now for four months.
But Chancellor Rishi Sunak said in an official response to the report that making concessions for those left behind would be impractical and expose the taxpayer-funded system to abuse from fraudsters.
In a letter to the committee, he insisted the Government had provided an unprecedented package of support, “among the most generous in the world”, but conceded many would have to fall back on less valuable help such as Universal Credit and other benefits.
He said he had already adapted the schemes as far as possible, including pushing back the furlough eligibility cut-off date to help 200,000 people who previously missed out by changing jobs “on the wrong day”, as well as making a concession for self-employed mothers left with smaller income support grants due to having recent maternity leave counted against them.
Mel Stride MP, who chairs the committee, said the Chancellor was going back on his promise that no one would be left behind.
“The Chancellor has said that he will do whatever it takes to support people and businesses from the economic impact of the pandemic. But well over a million people – through no fault of their own – have lost livelihoods while being locked down and locked out of the main support programmes,” he said.
“If it is to be fair and completely fulfil its promise of doing whatever it takes, the Government should urgently help those who have fallen through the gaps.
“It cannot just turn its back on those who are suffering.”
The furlough scheme is now supporting the jobs of 9.5 million people at a cost of almost £30bn, while almost three million self-employed workers have claimed £7.8bn in income support grants.
Those left without help now face the prospect of finding new work in a highly competitive job market as the country veers towards recession. Means-tested restrictions on access to Universal Credit will force those unable to make money to burn through savings before they can get help.
The Office for Budget Responsibility, the official forecaster, has said 12 million people could be out of work in the final quarter of the year, when the furlough scheme is due to be wound down.
To support jobs, the Government has set aside £1bn to help people find work and is doubling the number of work coaches in job centres. It has also launched the £2bn Kickstart Scheme, which pays up to £2,000 to firms hiring apprentices.
The Chancellor said the Government would do everything possible “to guarantee people and businesses the tools and opportunity to get through this and become stronger”.