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Scottish businesses and unions have welcomed the chancellor's announcement of an extension to the government's job retention scheme.

The furlough scheme had been due to end in June but will now run until October.

It means employees who are on leave because of coronavirus will continue to receive 80% of their monthly wages up to £2,500.

However Rishi Sunak said the government will ask companies to "start sharing" the cost of the scheme from August.

Furloughed workers will be able to return to work part-time from that point, with employers asked to pay a percentage of their salaries.

CBI Scotland said the step would "prepare the ground for firms that are reawakening, while helping those who remain in hibernation".

The Institute of Directors Scotland also welcomed the move but said it was important that "further clarity around this extension is provided should lockdown easing measures differ between Scotland and England".

The step was also backed by the Scottish Chambers of Commerce, which said it wanted to see further detail on the proposed employers' contribution.

Chief executive Liz Cameron said: "We would ask that this takes into consideration, particularly for SMEs (small and medium sized enterprises), their ability to pay contributions depending on how quickly their income recovers as lockdown eases.

"Trading conditions will differ depending on location and sector and the flexibility of the furlough scheme must take these factors on board."

Andrew McRae, from the Federation of Small Businesses, said the "shrewd decisions from the chancellor will give thousands of large and small Scottish employers the right sort of flexibility".

He added: "The move to allow operators to partially furlough their staff while they consider how to get back up to speed should mean more businesses have the right tools at their disposal.

"In the coming weeks, smaller firms will want to understand the next steps for the scheme."

Roz Foyer, general secretary of the STUC, said: "The extension of this scheme is absolutely vital but its detail will be all-important.

"Being able to use the scheme to support phased return to work through reduced hours is also an important step."