THOUSANDS fewer workers across County Durham and Darlington were on furlough in May - but the Government has been accused of acting too fast in winding down the scheme.

As of July 1, employers must pay 10 per cent of the salary for furloughed staff, rising to 20 per cent in August and September, when the support scheme ends.

But there are fears many businesses will not be able to afford the cost with parts of the economy still restricted by Covid measures.

The latest figures from HM Revenue and Customs (HMRC) show that 5,200 jobs held by workers living in County Durham were furloughed in May.

That was 7,000 fewer than the 22,200 furloughed at the end of April.

In Darlington, 3,000 jobs held by workers were furloughed in May - 1,700 fewer than the 4,700 furloughed at the end of April.

The reduction coincided with an easing of restrictions which led to the reopening of indoor entertainment and hospitality, along with holiday accommodation.

Read more: Delay furlough phase-out, Labour urges, as economists raise redundancy concerns

Figures show that in May across the county furloughed jobs in the retail sector dropped to 2,040.

In the arts, entertainment and recreation sectors, 560 fewer jobs were supported by the scheme, with 1,120 still furloughed

The number of hospitality jobs furloughed fell to 4,120.

Up to 3,300 self-employed workers in Darlington have received Government cash.

Across the UK, the total number of jobs furloughed fell by 1.2 million during May to 2.4 million at the end of the month.

The furlough scheme, formally called the Coronavirus Job Retention Scheme, started with the Government paying 80 per cent of a worker’s wages, up to £2,500 per month, if they were not able to work due to the impact of the pandemic.

Employers could choose whether to make up the rest of staff salaries.

The reduction in Government support to 70 per cent with firms now required to pay 10 per cent of furloughed staff salaries will cost businesses £322 in July to keep an employee earning £20,000 a year on the books, according to the Institute of Fiscal Studies.

The Northern Echo:

Labour's shadow chief secretary to the Treasury Bridget Phillipson said: "The Government must make sure economic measures go hand in hand with public health measures and that our British businesses and high streets are not left out in the cold.”

The Government has spent £66 billion on the furlough scheme since it started in March last year.

A spokesperson said: "We deliberately went long with our support to provide certainty to people and businesses over the summer, and that support, which is a substantial amount of funding, is continuing."

They added additional support was being given to businesses through grants, business rates relief and a cut in VAT.

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