Thousands of people in the West Midlands are currently on furlough. But the scheme is due to wind down next month, raising the prospect that many will have to sign on and look for new work.
Funding has been put aside to help people retrain for new jobs – and the UK government has also launched a controversial ad campaign, which features a picture of ballet dancer and the caption that her ‘next job could be in cyber’.
But West Midlands mayor Andy Street faced an impassioned warned about the “bureaucratic” process that local councils face in order to get the cash.
Mr Street took questions from councillors on the West Midlands Combined Authority Overview and Scrutiny Committee today.
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He answered queries about what would happen to the workforce when the furlough scheme stops at the beginning of November.
Workers will be able to receive at least 67 per cent of their pay from the Government if their workplace remains closed due to Covid as part of the Job Support Scheme.
But there are concerns for many whose workplaces will not have to close but which will not have enough business to continue to fund staff pay, such as the hospitality sector in tier 2 and 3 areas.
Councillor Stephen Simkins, representing Bilston East in Wolverhampton, said: “To retrain you need at least a six to eight-week training course. There is going to be a shortfall of income.
“It takes roughly around the same time to wade through the Universal Credit (UC) process. So for six to eight weeks, people and families will have no income – how will they survive?”
He added that money available for skills had to be bid for from the combined authority, and called upon the mayor to allow it to get to the most needy to streamline the process.
Councillor Simkins continued: “Why don’t we passport this money to the authorities to get these people trained as quickly as possible and back into the economy.
“We have got European funding ceasing for local business sport and activity, so we know it has been announced – how do we get that money and why do we have to bid?
“Surely in a crisis like this, bidding is going to protract that process even longer.
“It is important that we get the money and stop having to go through these rounds of bidding.
“It’s officer time at DWP and our local authorities. Surely we should recognise good practice and deliver that straight away.
“We are going to be faced with 40,000 people in Wolverhampton coming off furlough. That’s a potential 40,000 extra to the jobless figures.
“This is where you could lend a hand and stop the bureaucracy with the bidding rounds.
“This is terrible for people’s lives.”
Answering the points, Mr Street said: “There is European funding supporting a lot of activity across the West Midlands and it will dry up this April.
“We have known about this for a long time – since Brexit frankly.
“We have not yet got clarity from the Government as to what is going to replace it.
“It’s called the UK Shared Prosperity Fund. How it is going to be allocated in terms of how much for each region, what the priorities are – it’s a very live debate.
“It’s about £0.5bn over three years.
“We do work directly with local authorities but we do have to have a process by which there is our own challenge for different parts of the authority to want different cash. We can’t do without that.
“We have asked for an increase to sustain the increase in UC rate put up at the beginning of Covid and we have asked it is sustained.
“I think the DWP have committed to act on everything as swiftly as they can and you can of course have an emergency payment if your full payment does not come through quickly.”