Young female shopper buying detergent in supermarket, part-time furlough concept

MPs and retailers have been putting pressure on government to make furloughing part time from June

The government is listening to retailers about being allowed to bring back furloughed staff on a part-time basis, according to one senior source.

Although independent retailers are being asked to reopen from June, the Coronavirus Job Retention Scheme will only allow part-time furlough from August.

Given a cratered economy and uncertain demand, retailers are asking why the government insists on this all-or-nothing approach.

Some shops are gingerly reopening towards the end of the working week but would have to pay staff taken off furlough fully time.

“Part-time furlough has been raised by retailers and a number of MPs. It’s something that we’re looking at and try to respond to,” said the source.

“By extending the furlough scheme in the first place, and then extending it a second time, it shows that we’re listening. We do listen and hope we’re being seen to be flexible and responsive.

“Businesses are burning though cash with no changed in fixed costs. We are never going to have had perfection implementing schemes at such speed and scale.”

Self-employed owner-directors

Meanwhile, the government is still thinking about how to open up the Self-Employed Income Support Scheme (SEISS) to self-employed owner directors.

The problem, said the source, is that because self-employed owner directors pay themselves in dividends and not pay as you earn (PAYE), it is difficult to distinguish between a small company’s profits and passive income from other shares or property.

The Department for Business, Energy & Industrial Strategy (BEISS) estimates that 750,000 owner-directors are not eligible for the SEISs because of this.

Previously, small business minister Paul Scully, said he was talking to Treasury about ways to widen the scheme. However, the Treasury response has been cool, with chancellor Rishi Sunak being noncommittal when the same question in Parliament.

Scully said that he was open to owner-directors getting in touch with him directly, suggesting ways the self-employed scheme could be opened up to owner directors.

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