Satnam Gill: ‘It might be that the economy will recover quickly and things will get back to normal sooner than we think’

MORE jobs in the borough could be lost as the government’s furlough scheme comes to an end and companies choose to make people redundant rather than shoulder the cost of paying them, the council’s finance chief has warned.

The warning comes as figures show the number of people claiming unemployment benefits in the borough has more than doubled since lockdown began.

The amount of Universal Credit claimants soared by more than 9,000 from March 11 to midway through April, as lockdown started and businesses and firms shut down.

But figures now show the number of claimants in the borough has more than doubled to 28,112.

Non-essential shops reopened in the borough this week, though retailers and traders are limited in the amount of money they can make due to social distancing measures.

Labour councillor Satnam Gill, who replaced Cllr Andy Hull as finance chief shortly before the coronavirus crisis hit, said the numbers could get worse before they improve.

“At this stage we don’t know what will happen,” said Cllr Gill.

Chancellor Rishi Sunak

“We want as many people back in full-time, good employment as possible.

“It might be that the economy will recover quickly and things will get back to normal sooner than we think.

“But it’s also possible that as the amount of money the government will pay people on furlough decreases, more people start being made redundant. That hasn’t really happened yet, but it’s likely.”

Figures show 22,800 people in the borough have been furloughed since the start of the ­crisis, though this number includes those who work outside the boundaries of Islington.

The government is set to start tapering off the furlough scheme in August, and has said it expects employers to start contributing towards the cost of paying furloughed staff.

Cllr Gill added he was concerned about the impact of so many people on Universal Credit, particularly on rent arrears.

“Universal Credit causes so many other problems,” he said. “Your rent arrears go up, and all sorts of things start happening, almost as soon as your unemployed. It’s a worrying time for everyone, and at the moment we don’t exactly know what’s going to happen.”

Chancellor Rishi Sunak said the government would run the furlough scheme until October, describing the commitment as “extraordinary” and “generous”.

But he said that businesses would have to start contributing more to wages as the lockdown eased and people had more options to return to work.