News | Published August 16 2020

Royal Society calls for higher sick pay and flexible furlough to reduce health and economic risks

In a new report, the Royal Society has recommended that statutory sick pay is increased, and the furlough scheme is extended on a flexible basis.

The report, compiled by Sir Tim Besley and Sir Nicholas Stern, says that as the furlough scheme winds down in October, current statutory sick pay of £95.85 would dissuade workers from self-isolating when required to do so, hampering efforts to successfully implement contact tracing schemes.

It argues that reviewing sick pay and extending the furlough scheme on a flexible basis would help alleviate some health and economic risks.

The report warns that the current winding down of furlough by October does not account for the possibility of a second wave of Covid-19 cases during the winter months.

Sir Tim said: "I think the furlough scheme in its current form is almost certainly going to have to be modified to be more targeted towards occupations that can't resume anywhere near their normal level of activity.

"If people are being asked to self-isolate, they need to be cushioned against the economic consequences of that".

Sir Tim and Sir Nicholas both recommended minimising staff rotation between shifts in workplaces and introducing a subsidised testing system in workplaces where close contact is unavoidable.

The report also encourages the government to develop more detailed information to gauge the economic impact of certain policy interventions and combine that with health data to help optimise policy response in future.

Without doing so, the report says the UK could suffer an adverse effect both on public health and the economy.

A government spokesperson said that the furlough scheme has already “protected more than 9.6 million jobs” and supported over “two million self-employed people” as well as paying out “billions in loans and grants to thousands of businesses”.

The spokesperson added: “For those in most need, we've provided an unprecedented package of support including injecting £9.3 billion into the welfare system, mortgage holidays and additional help for renters.

"We've also made sick pay payable from day one and will refund employers with up to 250 staff the cost of up to a fortnight's sick pay. Employers can, and many do, pay more than the statutory rate."

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Authored by

Alexander Bridge-Wilkinson
Junior Editor
August 16 2020

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