Scots government encourages taxpayer-funded bodies to use ‘loophole’ to furlough public sector staff


Scottish government is encouraging taxpayer-funded bodies in Scotland to take advantage of a ‘loophole’ in Treasury rules to furlough public sector workers

  • Hundreds working for arts organisations taken out of work on programme
  • SNP administration encouraged ‘cultural organisations’ to bid for cash  
  • In rules for those whose ‘public funding only forms part of their income stream’
  • Scottish Tories said it was ‘clearly against the spirit and the letter of the scheme’
  • Here’s how to help people impacted by Covid-19

Nicola Sturgeon’s government has been accused of manipulating a loophole in the Treasury’s coronavirus furlough scheme to divert cash to public sector workers in Scotland.

Hundreds of people working for arts organisations have been taken out of work on the programme after the SNP administration encouraged ‘cultural organisations’ to bid for cash.

Historic Environment Scotland and Sportscotland are among those which have furloughed workers despite receiving millions in state grants to part-fund their activities.

The Scottish government defended the move, with a spokesman saying the Job Retention Scheme was ‘open to public bodies in Scotland and across the UK where public funding only forms part of their income stream and where they have experienced a reduction in other funding’, according to the Telegraph.  

But The Scottish Conservatives’ shadow finance secretary Donald Cameron said public bodies accessing the scheme were ‘clearly acting against the spirit and the letter of the scheme’.

Historic Environment Scotland said it had furloughed 900 staff, 61 per cent of its work force, after being forced to close its attractions. They include Edinburgh Castle, which attracts thousands of visitors and hosts the annual Tattoo military extravaganza (pictured)

Nicola Sturgeon

Douglas Cameron

Hundreds of people working for arts organisations have been taken out of work on the programme after Nicola Sturgeon’s (left)  SNP administration encouraged ‘cultural organisations’ to bid for cash. Scottish Conservatives’ finance spokesman Donald Cameron (right) said public bodies accessing the scheme were ‘clearly acting against the spirit and the letter of the scheme’

‘While any business suffering a financial loss as a result of the crisis has every right to apply for this kind of support, those accessing funds they don’t need must think twice, given that it will simply increase the cost to taxpayers and slow down our future economic recovery,’ he said.

‘It would be extremely serious if there is evidence to show that the Scottish Government might be encouraging any sort of ”double dipping” that is contrary to the rules of the furlough scheme.’

The furlough scheme is set to pay out more than £100billion to ensure UK businesses do not lay off workers. 

Its rules state that it cannot be used by organisations which receive public money to pay staff.

But the Scottish Government, in advice to organisations seen by the Telegraph, says that its grants ‘usually support activities and outcomes rather than specific staff costs’, adding: ‘We encourage all cultural organisations to consider whether an application to the Coronavirus Job Retention Scheme would be a way to mitigate some of the challenges.’

Historic Environment Scotland said it had furloughed 900 staff, 61 per cent of its work force, after being forced to close its attractions.

They include Edinburgh Castle, which attracts thousands of visitors and hosts the annual Tattoo military extravaganza.

A spokeswoman said: ‘HES is a Non Department Public Body (NDPB) with charitable status and a large percentage of our funding is sourced through visitor revenue at historic attractions which have been closed since March 18.

‘HES has worked in partnership with our Trade Union Alliance to develop our application of the UK Government’s Coronavirus Job Retention Scheme, which as a NDPB, is accessible to us.  

‘We are continuing to review the situation, as the Scottish Government continues to set out its plans following the announcement of its phased route-map, and as part of our resumption planning for restarting operations when it is safe and right to do so.’