Coronavirus: Government admits two-thirds of usual wages for employees under local lockdown will be ‘very challenging’

Remarks come as PM prepares to update country on new restrictions

Employees forced to live on two-thirds of their usual wages due to coronavirus restrictions will find it “very challenging”, the culture minister has admitted, as northern leaders and businesses criticised the levels of financial support.

The remarks from Oliver Dowden, who failed to say whether he could live on two-thirds of the government’s national living wage, come after the Treasury’s economic support package was labelled “insufficient” and claims it would see “communities plunged into hardship”.

On Monday, Boris Johnson will address the nation and update MPs on a new three tier system for England, dividing the country into medium, high and very high alert levels, with some businesses forced to close once again to stem the spread of Covid-19.

In an attempt to alleviate financial concerns of workers, last week Rishi Sunak, the chancellor, outlined plans to pay two-thirds the wages of employees in pubs, bars and restaurants – legally required to close in certain areas – up to a maximum of £2,100 per month.

It is less generous than the blanket furlough scheme unveiled at the onset of the pandemic in March, which paid 80 per cent of workers’ wages up to a maximum of £2,500 per month.

Appearing on Sky News, Mr Dowden was repeatedly asked whether he could live on the government’s national living wage, which would be reduced from £8.72 to £5.84 per hour under the chancellor’s new scheme for employees of closed businesses.

“I know these are very challenging times,” he said. “The chancellor has taken unprecedented measures to try and ameliorate the worst impacts of it.

“It’s worth noting the scheme you’re talking about compares very favourably and is broadly aligned to France, Italy, indeed better in many respects than countries such as Germany. We are taking measures that are necessary in order to protect people through this difficult period.”

Asked again, he added: “Of course it is very challenging for people. But we’re taking against this backdrop the best measures we can.

“Of course that is very, very difficult for people who are in that situation. That’s why we want to move as quickly as we can whilst controlling this virus to more of the normality of reopening the economy so that people are able to have their jobs back.

“I acknowledge it’s very challenging for people – of course it’s very challenging, but so many aspects of this terrible disease are very challenging for people.”

Earlier, Sacha Lord, the night-time economy adviser for Greater Manchester said of the new cheme: “When the UK went down into national lockdown it was 80 per cent furlough. But now, if you live in the north and work in hospitality, you will see 67 per cent.

“It doesn’t make sense, it’s not fair, and for us, and for many, many other operators, it feels like we’re thrown under the bus.

He said it is "far safer, in our opinion" to go to a pub where there are restrictive measures in place, rather than people ending up at house parties.

"Whoever's making these knee-jerk decisions in the Government are not dealing with operators because we saw what happened with the curfew and, by leaking that news that came out on Wednesday, what do you think happened in the city centres across the UK this weekend? On Saturday night it was like New Year's Eve."

On Saturday, the mayors of Greater Manchester, Sheffield, Merseyside and Tyneside, which are all facing the prospect of greater restrictions, said the chancellor’s new economic support package would “level down the north of England and widen the north-south divide”.