Lockdown round two: Your money questions answered

England is approaching a month-long lockdown at least, Wales and Northern Ireland are still enduring a circuit breaker, and Scotland is dealing with a tough five tier system.  

It may be chaos out there, but your financial circumstances don’t need to join the general panic. Here’s the new information you need to navigate these turbulent waters.

Am I eligible for the furlough extension?  

One of the biggest criticisms of the way the government has handled the financial fallout of a second lockdown is how long they waited to announce the extension of the furlough or job retention scheme.  

With the extension coming literally hours before it was due to be replaced by the less generous job support scheme (JSS), thousands of people whose bosses had already formally terminated their contracts in anticipation of the scheme’s end will now face unemployment in a terrible jobs market.

However, anyone who was still on a payroll on 30 October – even if they had received notice but hadn’t yet officially left – can transfer onto the newly extended furlough scheme, the chancellor confirmed this week.

Now set to run until the new lockdown is currently due to end on 2 December, the details of furlough for employees and businesses are likely to remain broadly the same.  

Any kind of business can apply as long as they use the UK PAYE scheme and have a bank account. It is up to employers, rather than employees, to arrange the help.

The government will pay 80 per cent of a furloughed worker’s salary up to a maximum of £2,500 a month where that member of staff can’t do their job because of the pandemic.

Employers will continue to be responsible for national insurance and pension contributions – a cost of around 5 per cent for an employee on average earnings.

With the clock reset, the scheme is now newly available for November claims relating to those employees who joined businesses after 19 March and by businesses which haven’t previously claimed against the scheme.

When it does finally end, the furlough scheme will be replaced by the JSS, which could secure a minimum of 67 per cent of an employee’s salary for businesses that have been forced to close and 73 per cent for businesses where an employee worked at least 20 per cent of their usual hours.

I’m self-employed. What help is there for me now?

Finally bowing to pressure over the limited self-employment income support scheme (SEISS) offered during the first wave, the chancellor announced on Monday that SEISS grants will now be calculated on the basis of 80 per cent of average business profits over the last year rather than 40 per cent – up to a maximum of £3,750. This brings the support for the self-employed into line with the job retention scheme.

But the new deal will only be open from the end of November to cover that month, with some assumptions but no promises yet of further help if lockdown continues.  

The scheme as it now stands will also continue to ignore as many as 2.9 million freelancers, contractors and newly self-employed with few business records, critics warn.

To date, the government’s response has been to point to the £20 improvement to weekly universal credit support and tax credits, though the Department for Work and Pensions has been urged to improve that further to help tackle the pandemic crisis.  

What financial help is there if I get the virus?  

There appear to be no changes planned over the amount of statutory sick pay available to those who are unwell, with the government simply highlighting that it is available from day one of illness.  

However there is, in theory, up to £500 available for those on lower incomes who are told to self-isolate by the NHS Test and Trace team – though not if they are only advised to do so by the NHS Covid-19 app. You are also obliged by law to self-isolate for 10 days if you receive a positive test result. (Members of an affected household must self-isolate for 14 days.)

From the end of September, to coincide with self-isolation becoming a legal obligation which carries a fine for failure to comply, local authorities should make the payment as long as recipients are employed or self-employed, are unable to work from home and are currently receiving certain benefits.

The payment is made on top of any statutory sick pay or benefits you receive.

I’m worried about paying my debts now. What’s happening with payment ‘holidays’?

Mortgage payment pauses and other payment deferment options that should have come to an end on Saturday are to be extended, the Financial Conduct Authority (FCA) confirmed on Monday.  

Anyone struggling to meet mortgage, credit card or personal loans can request a break in their repayments for up to a total of six months, including those who have already benefited from a three-month payment deferral.  

The rules will also apply to people paying off other forms of debt including rent to own and buy-now-pay-later deals.  

Those with short-term loans, such as payday loans, can apply to defer their payments for one month.  

Financial experts are warning against the use of the term “holiday” when it comes to these pauses in debt repayments as interest continues to add up during the deferral period, adding to the overall cost.  

Anyone considering requesting a new payment deferral or extending an existing one should only do so if it is really necessary and lenders are being encouraged to look for other solutions for consumers too.  

I’m meant to be moving house soon. Will I still be able to?  

With a property market boom underway, and house prices increasing by almost 6 per cent despite woeful economic data, housing secretary Robert Jenrick has confirmed that home moves for both buyers and renters can happen during this lockdown.  

Removals and estate agency businesses can continue to trade as long as they adhere to Covid guidance on safety.

I have tickets for an event next week. Will I get my money back?  

If you and your upcoming event are in England then it’s very unlikely to be going ahead. That includes private events involving more than one household like weddings as well as broader public arrangements like sports events.  

If you’re in Wales, Scotland or Northern Ireland, some restrictions are due to change in the coming days so check your government’s plans.

Across the UK though, if you bought tickets from the event organiser and they have now cancelled, you should receive a refund though this is unlikely to include booking or delivery costs. Get in touch with them if you don’t hear from them.  

If you bought tickets from a third party your protections aren’t as clear cut. As above, contact them if they don’t beat you to it.

If the event is postponed rather than cancelled, keep hold of any physical or e-tickets or other paperwork. If you can’t make the re-arranged date get in touch with the organiser for a refund, though again, if you made plans via a secondary seller you may struggle.

Always wait for the organiser to cancel in the current circumstances rather than doing so from your end as doing so may make you liable for the full cost.

What about our upcoming holiday?  

Anyone currently on holiday can finish their planned break before returning home. But if you haven’t yet left, you won’t be able to.

Plenty of people still haven’t been refunded for cancelled flights and holidays during the first lockdown, but if your accommodation, flights and related plans are cancelled due to coronavirus you should get a refund.  

According to Which?, the new lockdown announcement shouldn’t significantly impact insurance policies themselves. It may however, lead to claim situations that would have been within the scope of cover in the last lockdown, but this time around, aren't. This time, in other words, disruption due to Covid-19 was a known risk when you made your plans assuming they were made after March.

“Following the outset of the pandemic in March, policies on sale for these types of insurance have become far more restrictive in the cover they'll make available where it relates to Covid 19 – particularly when it relates to government action,” a Which? spokesperson said.

“Whenever you arrange your cover or the event, you should carefully check your individual policy, you also need to explore additional protections for cancelled services – such as provider refund policies and payment card protections.”

The UK’s devolved nations are dealing with the Covid-19 virus, social distancing measures and mitigating the financial impact on consumers in different ways, so it is vital to check with regional and local authorities for further details and guidance before taking significant action.  

This information was correct at the time of writing.