Covid-19

Dominic Raab is a lawyer, not a doctor, by temperament as well as training. He is not a politician who talks about his feelings much. This made it all the more striking to hear him talking about Boris Johnson as a ‘friend’, and his hopes for his recovery. The reassuring news is that Boris Johnson’s condition is stable and he hasn’t required a ventilator. Raab faced a barrage of questions about how him deputising for Boris Johnson will actually work Understandably, Raab faced a barrage of questions about how him deputising for Boris Johnson will actually work. Raab emphasised Cabinet collective responsibility and how they were implementing the plans that Boris Johnson had already set out.

In Britain and America, the employment news is grim. Nearly a million Brits – 850,000 more than usual – have applied for Universal Credit in the last fortnight. While in the United States, unemployment has reached an historic high. As of the end of last week, 6.6 million people claimed for out-of-work benefits. This is the highest increase in adjusted seasonal claims on record and is made even more astonishing when you consider that just four weeks ago fewer than 200,000 people applied for jobless benefits.  With every day that goes by, the health implications of Covid-19 are becoming clearer, as are the economic effects.

The Chancellor’s emergency package for the self-employed is one of the most generous schemes to be offered worldwide so far, covering up to 95 per cent of the UK's self-employed workforce. The details of the scheme, explained here, include a taxable grant worth up to 80 per cent of one’s profits over the past three years, capped at £2,500pm – notably on par with salaried workers who earn, on average, £340 more each month than self-employed workers. There were plenty of potential pitfalls and unnecessary giveaways the Treasury managed to dodge: wary of dishing out cash to super-wealthy contractors and consultants, the Chancellor has only opened the scheme to workers trading with profits up to £50,000.

Britain is midway through a deep recession: of that there is no doubt. But what next? Oxford Economics has today been one of the first to offer an answer, predicting a V-shaped economic recovery (sharp economic downturn and sharp economic revival) and near-complete economic repair. It is, of course, a guess: all forecasts are. But it’s one worth looking into in a bit more detail. All published economic forecasts pre-Covid-19 (including those accompanying the Chancellor’s Budget last week) are defunct, so this is an early test - one that factors in the Government's policy of ‘social distancing’ and the profound impact this has on business as usual. Oxford Economics has replaced its estimate of modest GDP growth of one per cent to a prediction of a fall of 1.

The new Bank of England governor Andrew Bailey has warned that the UK is facing an 'economy emergency' and the worst is yet to come. Speaking to Sky News, Bailey said the UK economy needs to brace itself for a ‘very big downturn’. 'Everything's on the table that is reasonable,' he said, referring to the policy tool kit at the BoE's disposal to help manage any economic crisis in the coming weeks and months. The governor’s warning comes a day after Chancellor Rishi Sunak's unprecedented £350bn coronavirus stimulus and hours after the pound plummeted below $1.20 – its lowest level against the US dollar since 1985. Investors are abandoning the pound and flocking to the dollar as they prepare for waves of economic hits across the world.

The government has bowed to the inevitable and announced that May’s local and Mayoral elections have been postponed. With the Chief Scientific Advisor saying that the coronavirus peak is 10 to 14 weeks away, it was hard to see how you could have had an election campaign within that period. As I said in the Sun last Saturday, Whitehall has been braced for a delay to these elections for a while now. They will now not take place until 2021, meaning that there’ll be no immediate electoral test for the new Labour leader. These elections won’t be the last event to be postponed. The current thinking among those leading the government’s response to the virus is that a government bar on big public gatherings is, probably, about a month away.