The vacation program, which pays 80 percent of the wages of people unable to work due to the pandemic and coronavirus lockdown, has been extended to the end of March 2021.
Chancellor of the Exchequer Rishi Sunak announced the move in the House of Commons on Thursday afternoon, the day the new lockdown rules come into effect in England.
He said the vacation change would apply across the UK.
The measures mean that employers only have to pay social security and pension contributions for employees who cannot work.
The vacation program initially ended at the end of October after it had been settled on 60 percent of pay.
Mr Sunak then extended it to December in light of the new lockdown and tiered restriction rules.
He has now extended it to the next year “to create security”.
He told the Commons: “We can announce today that the vacation program will not be extended by a month, but through the end of March.
“The government will continue to help pay people’s wages up to 80% of the normal amount. All employers must pay the employer’s NICs and pension contributions for hours not worked.
“We’ll be reviewing the policy in January to see if economic conditions are improving enough to ask employers to make more contributions.”
Mr. Sunak also outlined the support for the self-employed.
He told MPs: “For the self-employed, I can confirm that the next Income Support Grant, covering the November to January period, will now increase to 80% of average earnings up to £ 7,500.”
And Mr Sunak told the Commons that “upfront guaranteed funding” for the decentralized administrations will increase by £ 2 billion.
He said, “I also want to reassure the people of Scotland, Wales and Northern Ireland. The vacation program was designed and implemented by the UK Government on behalf of all the people of the UK, wherever they live.
“That has been the case since March, it is the case now and will remain so until next March.
“It is proof of the strength of the Union and an indisputable truth of this crisis. We have only been able to provide this level of economic support because we are a United Kingdom.
“And I can announce today that Upfront Guaranteed Funding for decentralized administrations has increased from £ 14 billion to £ 16 billion.
“This treasury is, was and always will be the treasury for the whole of the United Kingdom.”
Mr Sunak said he needed to make “swift adjustments” to the government’s economic response to the Covid-19 pandemic as the virus spread.
He told Commons, “I know the people watching at home have been frustrated with the changes the government has made over the past few weeks.
“I had to adjust our economic plans quickly as the spread of the virus accelerated.”
Mr Sunak closed his Commons statement with a detailed rationale for extending the leave, claiming the second lockdown in England was the “only viable solution to protect our NHS”.
He told MPs: “Given these changing public health restrictions and the economic trauma they would cause in job losses and business closings, I thought it best to extend the vacation program rather than this one It’s time to switch to the new system for supporting workplaces.
“Political opponents have chosen to attack the government for trying to keep the economy going and to make sure the support we are providing encourages people to keep working.
“And they will no doubt now criticize the government on the grounds that we had to change our approach. But for anyone in the real world, this is exactly what you have to do when circumstances change.
“We all hope for the best, but make sure we plan for all eventualities.”
The Chancellor added that he would “leave it to the people” to decide whether the government’s action was the right one, adding, “I know the support we are providing will protect millions of jobs. What I know is that it is never wrong to use our words and actions to instill confidence in this country and our economy, and I know that today’s announcement will bring immense comfort to people and businesses in our country during a difficult winter. “