Businesses 'will have to pay a fifth of furloughed workers' wages'

Businesses will have to pay at least a fifth of the wages of furloughed workers in coming months, it has been reported.

Chancellor Rishi Sunak has said the furlough scheme will be in place until at least October with companies to be asked to "start sharing" the cost from the start of August.

The Times reports that the Treasury has devised a scheme which would see employers cover between 20 per cent and 30 per cent of a worker's wage.

The plans would also see firms paying national insurance contributions, which are approximately 5 per cent of people's wages.

The furlough scheme - which pays 80 per cent of a worker's salary up to a £2,500 monthly cap - currently supports around 7.5 million jobs, with Mr Sunak saying earlier this month he was preparing to "wean" workers and business off the programme amid concerns that the nation was becoming "addicted" to it.

The latest report comes a day after new data showed the total volume of retail sales dropped a record 18.1 per cent in April as hundreds of thousands of businesses were forced to shut up shop to help tackle coronavirus.

The Chancellor has warned the UK is "likely to face a severe recession, the likes of which we haven't seen".

Record borrowing and an unprecedented collapse in retail sales have laid bare the devastating impact of the lockdown after Britain reported its worst ever week of economic data.

The Treasury borrowed £62.1bn in April, the biggest single monthly figure in history, as tax revenues crashed and spending surged.