| The furlough scheme is already predicted to hike our tax bills for years to come, but many of us may end up paying for it in more ways than one.
The “triple lock” has been the safeguard of pensioners for around a decade. It promises to pay retirees a state pension that will rise every year by the highest of wage growth, inflation or 2.5pc. As Telegraph Money revealed on Saturday, this guarantee could become unsustainable for the Government’s coffers as wages are artificially boosted when the furlough scheme winds down.
Earnings are forecast to rise dramatically next year as workers who took a pay cut on furlough or because of redundancy resume full-paid work. According to the Office for Budget Responsibility, the jump could be as much as 18pc. At the end of 2019 annual wage growth was around 3pc.
The cost to the Government if it were to give 12 million pensioners an 18pc rise in income would be an extra £10bn, provoking calls for the Government to scrap the benefit. Freezing it for two years would cost pensioners £1,900 per year, according to new calculations.
The cost of the job retention scheme may also have been inflated by false claims from businesses. Whistleblower hotlines have received thousands of calls from workers being forced to continue doing their job on 80pc of their usual pay, while their employer gets the Government to cover their wages, pretending they are not at work.
The Government plans to give businesses a 30-day window of opportunity to confess to furlough fraud and fines are planned for those who do not follow the rules. Both employers using the furlough scheme and the self-employed who applied under the Self-Employment Income Support Scheme will be investigated.
After the grace period, HMRC will have free rein to pursue anyone, from small business owners to freelance plumbers, using both criminal and civil powers. A small misunderstanding early on of how the schemes worked could soon prove very costly.
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