A four-month extension of the government’s furlough scheme to October 31 has been welcomed by a host of travel agencies.

The Job Retention Scheme, which pays 80% of salaries up to £2,500 a month, will be extended for all sectors and regions, chancellor Rishi Sunak announced on Tuesday.

From July, the scheme will allow firms to bring workers in on a part-time basis if they contribute a percentage towards the 80% salary.

Miles Morgan Travel chairman Miles Morgan said the scheme had “massively exceeded expectations”. He welcomed its extension and without dilution of cover to 60% of salaries as had been predicted.

“To have flexibility we didn’t have before – you couldn’t hope for more than that,” he said. “By October you would hope there would be better news on a [Covid-19] vaccine.”

Without an extension to the scheme, large-scale redundancies across the industry would have been inevitable, Morgan added.

Gemma Antrobus, owner of Haslemere Travel, described the announcement as “excellent news” and said allowing part-time work was “much more realistic”.

Fred Olsen Travel head of commercial Paul Hardwick said he would now rotate staff to work three or four weeks at a time.

But he called on the chancellor to allow special dispensation
for sectors such as travel, which is having to process refunds while also suffering big drops in sales revenue.

Hardwick suggested furloughed agents could work on processing refunds, allowing staff paid by travel firms to focus on new bookings to bring money into the business.

“The whole point of the [furlough] scheme is to prevent redundancies, but if we’re not making enough sales it will just lead to redundancies in the end anyway,” said Hardwick, who said Fred Olsen Travel had rebooked £1.5 million of business in eight weeks but was still chasing 850 refunds from operators.

Mark Johnson, director of Polka Dot Travel, agreed a sector-specific scheme would be “a great help” and “take the pressure off” other staff to focus on 2021 sales.

Jill Waite, owner of Pole Travel, said: “Great news that our staff can still be paid.”

The scheme has so far supported a million businesses and 7.5 million employees at a cost of £14 billion a month to the Treasury.