Guardian and PA pay back £3m in UK government furlough cash

The Guardian and PA have each paid back more than £1m in furlough cash claimed from the Government since the Covid-19 pandemic began.

Guardian Media Group said it would pay back its £1.6m claimed in full because it was in a “substantially improved financial position” due to job cuts made last summer and an increase in reader contributions.

Meanwhile PA Media Group last month repaid the £1.35m it received between April and December last year.

HMRC did not initially name any companies claiming furlough cash – covering 80% of a worker’s salary if they are put out of work, sometimes to be topped up by their employer – because of taxpayer confidentiality.

It has been able to do so since December because of a Treasury direction made under the Coronavirus Act 2020 when the scheme was extended.

In December and January the Guardian was the only national newspaper publisher to still be claiming furlough cash – somewhere between £50,000 and £100,000 each month.

It has now revealed it decided to return all the cash after revenues for the 2020/21 financial year remained “largely flat” on a better-than-expected £225m (£223.5m in 2019/20).

In July GMG predicted Covid-19 would take £25m off its forecast revenues for the year due to the hit to advertising, Guardian Jobs, physical events and print.

GMG has reported a net cash outflow of £16m (compared to £29m the year before). The Scott Trust, GMG’s non-profit endowment fund, provides up to £30m in cash each year.

The Guardian said its print and advertising income continued to fall but digital revenues from online subscriptions and one-off reader contributions rose by 61% to £69m.

The newspaper group planned to cut 180 jobs in the summer, about 12% of its workforce: 70 in editorial and 110 jobs mostly across advertising, Guardian Jobs, marketing and Guardian Live. However it was able to reduce the final number of roles cut to 130.

PA claimed some £300,000 to furlough about 200 staff across the group in April last year, including 44 sports and racing journalists, as it hoped to “mitigate the financial impact of Covid-19”.

Other temporary cost-saving measures put in place included salary cuts for senior executive management, a recruitment freeze, and “scaled back” freelance and contractor costs.

The group’s head of HR told staff at the time: “Acting now will help us reduce the prospect of major job losses and retain our existing talent for when business returns to some normality in the future.”

Its final claim made in December was worth about £50,000. A significant number of staff had returned to work in the summer, including in the sports department as action resumed.

By December PA was therefore experiencing better business conditions than it had expected during the uncertain period at the start of the pandemic.

Other media companies to have paid back their furlough cash include Telegraph Media Group, The Spectator and Future. Other companies such as Mail publisher DMGT and Sun and Times owner News UK chose not to use the scheme at all.

Those still claiming in January, the latest figures available, include regional publishers Newsquest, JPI Media, Archant and Midland News Association and others such as Time Out, Tortoise, Vice and The Economist.

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