UK, Europe devise furlough schemes, bailouts for coronavirus-hit private sector

"This is not a time for ideology and orthodoxy. This is a time to be bold. A time for courage," said Rishi Sunak, the UK's Indian-origin finance minister, as he summed up the British government's approach towards the daunting economic fightback against the novel coronavirus pandemic and broadly reflective of the approach taken by most other countries across Europe.

The words from a landmark speech last month by a Chancellor of the Exchequer from the UK's ruling Conservative Party, traditionally staunch believers of free market principles, unleashed an unprecedented set of state measures targeted at protecting jobs and incomes for the private sector as the country went into lockdown mode to try and curb the spread of the deadly virus.

“The coronavirus pandemic is a public health emergency. But it is also an economic emergency. We have never, in peacetime, faced an economic fight like this one,” said Sunak, as he tabled a series of mini-Budgets just days apart over the last few weeks to revive the country's economy. He began by announcing an unprecedented package of government-backed and guaranteed loans to support businesses – big and small. An initial 330 billion pounds of guarantees – equivalent to 15 per cent of the UK's GDP – was made available, with a promise of more as required.


This meant any business requiring access to cash to pay their rent, salaries of their employees, suppliers, or to purchase stock, had the option to access a government-backed loan on attractive terms. Soon the hedge-fund-manager-turned-finance-minister bolstered this offer further, introducing the UK to a lesser-known terminology – furlough or forced leave.