Martin Lewis warned nursery workers today against furlough as new guidance came out on Friday that some may not be able to claim up to 80 percent of their salary. The Money Saving Expert explained the huge change means managers won’t be able to afford to pay some staff if the company also receives public funds. He added nursery workers have contacted him fearing collapse.

Speaking on BBC Radio 5 Live, Mr Lewis said: “Nurseries is one of the big changes. If you are furloughed, you are still entitled to the 80 percent of furlough.

“That’s a myth, that 80 percent.

“Guidance came through on nurseries on Friday that is totally new and we have not seen before.

“What it effectvely says is where nurseries get public funds, which many do due to the Government pays for it, they should not be doubling up and paying staff from furlough funds where they get public funds.

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“In a nutshell, if 40 percent of their income comes from public funds and 60 percent comes from private funds then they can claim furlough for up to 60 percent of their staff but they can’t claim it for 100 percent of their staff because the rest should be coming from the funds that normally come from the public that are still being paid right now.

“There’s arguments about whether that is fair or not.”

Mr Lewis went on to highlight the huge problem this has set out for nurseries.

He explained a huge worry for the businesses now is collapse as bosses are unsure if they can pay all their staff.

The Government scheme for workers who have been furloughed – given a temporary leave of absence – has launched, and Chancellor Rishi Sunak has announced a £1.25 billion package to aid companies in the innovation sector.

The Coronavirus Job Retention Scheme allows businesses to claim towards staff wages and comes after the Government was warned of the economic cost for many companies of any delay in its implementation.

Under the initiative, employers can go online to claim cash grants worth up to 80% of wages, capped at £2,500 a month per worker.

The Treasury has said the system can process up to 450,000 applications an hour with employers expected to receive the money within six working days of an application.