The UK Government’s approach to suppressing COVID-19 risks becoming the worst of all possible worlds. Partial measures to half-close the hospitality and other sectors without providing sufficient financial support to the businesses in them will not suppress the rate of infection sufficiently to cut the death rate and protect the NHS, but will almost certainly lead many businesses to close and workers to lose their jobs.
As both SAGE and The Lancet have said, short but deep ‘circuit breaker’ lockdowns are the only way to rapidly reduce the R rate to a level which can then allow the economy and social life to open up again. But they must be accompanied by the generous furlough and business support schemes for which the Chancellor was rightly praised in the spring. Support to the self-employed and those on Universal Credit also needs to be increased.
Yes, this will cost the Treasury money. But, as in times of war, there is no effective economic limit on crisis spending: debt can be absorbed now by the Bank of England and paid back over 25 years or more.
