Anyone who overly celebrated the news that Chancellor Rishi Sunak had decided to loosen the state’s purse strings and start throwing money around may be waking up to the realisation that there are hard times ahead.
The day after the Budget is always a time when the cold, hard reality starts to hit home as experts get to grips with the fine detail. But that process was accompanied by the growing realisation of just how serious the coronavirus outbreak is shaping up to be.
As he announced the authorities were moving to the second ‘delay’ phase of dealing with the disease, Boris Johnson warned the nation was dealing with its “worst public health crisis for a generation”, saying he “must level with the British public, many more families are going to lose loved ones before their time”.
One of the UK’s leading think tanks, the Institute of Fiscal Studies, said the Chancellor’s £12 billion coronavirus package was “substantial” and looked to be “fairly well designed”. However, it added that the UK’s projected economic growth rates were “feeble and indicative of an economy that is not in a robust position for coping with shocks like the coronavirus”. The Resolution Foundation said households in Britain were set to take a £600 a year hit to their budgets, if the Office for Budget Responsibility’s “incredibly grim, and yet still unbelievably optimistic, pre-pandemic markdown to the UK’s economic outlook” was correct.
So, it appears the UK is facing not just a major outbreak of a potentially deadly disease to which we have no immunity – as Johnson pointed out – and, as yet, there is no vaccine, but also a serious economic situation that could feel like austerity is still with us.
And, of course, the outbreak has the potential to make our financial situation worse.
All this underlines just how fragile our current situation is. And, in times like these, we need to pull together, to do what we can to help one another, and to try to take the pressure off public services, if we can. What is true on an individual level is true on a global scale. We must work with other countries to try to minimise the harm caused the coronavirus outbreak and to keep the world’s economy on the best possible course. And, for the UK, that means ensuring it reaches a fair and comprehensive Brexit trade deal with the EU.