Nearly 500 businesses asked to pay back £5.3m in covid job support

Friday 11 June 2021

Nearly 500 Jersey businesses have been told to pay back money they received via the Government’s covid job retention scheme - with £5.3m in total identified for recovery.

£3.5m has been recouped so far, with £1.8m in funds still to be repaid.

The Co-Funded Payroll Scheme (CFPS) launched as the island plunged into lockdown in March last year, and saw the Government cover up to 80% of a worker’s salary up to £2,000 per month if employers could prove a certain level of detriment.

Between March and August 2020, the Government helped a total of 67,137 islanders, costing £80,981,348.32. Its peak month was April, with 16,500 employees receiving payments of £21.5m. To date, £129.9m of funding has been provided.

But now it’s emerged that, following a “rigorous audit process”, 486 businesses are being asked to pay all or some of that financial assistance back, while 11 have decided to do so voluntarily.

The Treasury Minister revealed the figure following a written question from Deputy Rob Ward, who wanted to know whether any of the companies now being asked to repay had made a profit in the last year.

Pictured: More than 67,000 jobs were supported by the payroll scheme in the first six months of the pandemic.

“The CFPS does not capture data on businesses’ profitability though it should be noted that the Scheme exists primarily to sustain employment and livelihoods while the pandemic continues to prevent the economy from operating as normal," Deputy Susie Pinel replied.

"Businesses may make profits, but still be in a position of having to consider reducing employment so, to avert this outcome, the CFPS allows qualifying businesses that have suffered at least a 20% fall in income to make a claim even if they remain profitable.

"The Government nevertheless continues to encourage voluntary repayments of CFPS support from businesses that have gone on to have a successful financial year whilst recognising that covid-19 presents the most significant economic challenge to have faced the Island in a generation, so such businesses will always be a small minority.”

When asked how much money had been identified for recovery, the Treasury Minister told Express: "The Co-Funded Payroll Scheme was launched to support business and Islanders during one of the biggest economic threats the Island has faced. The rapidly-evolving covid-19 situation meant that the scheme was designed to make funds readily available on a rolling monthly basis, to make sure that businesses could stay afloat, and to protect individual Islander’s livelihoods.  

“Given how fast-moving the situation was, and the immediate need of businesses and employees, we took the decision to set up checks on a retrospective basis.

“In total, £5.3m has been identified for recovery. Following a review of the funds distributed, we have recovered £3.5m with £1.8m in funds still to be repaid.”

At the time of the scheme’s launch, any firm that signed up to benefit from the support was warned that the Government intended to “periodically publish appropriate information” about claimants, including the name of the business, number of employees claimed for, and total amount claimed.

The data for between March and August 2020 was compiled in a report and recently published on the Government website in April.

Officials are also understood to be considering whether the names of companies that have had to pay back money should be published.

Click HERE for a breakdown by sector and the top 50 claimants during the first part of the scheme.