The Chancellor, in his statement today, used the forecasts from the OBR’s “central scenario” when it comes to Covid complications. So Guido took a look at those underlying assumptions. The OBR assumes, presumably with good reason given how closely it works with the Treasury, widespread deployment of a vaccine by the middle of 2021, not by the Spring, with a high to medium level of restrictions until then. The differences in implied borrowing, growth, and scarring are stark.

The “upside” scenario the Government is clearly not confident of taking place, involves restrictions “broadly equivalent” to October 2020’s tiers 1 and 2. The Government’s modelled upside is the previous tiered system. Meanwhile the ‘central scenario’ expects the whole country to be between tiers 2 and 3 right through until “mid 2021“. No household mixing until June…

As Boris stated earlier this week, his post-lockdown plan is for a “new, stronger and more sustainable tiers framework on 2 December”, styled as “tougher than in October” – reinforcing the Government’s view that we will find ourselves in the OBR’s “central scenario” where things “may vary regionally and temporally”, however are still predominantly repressive until the start of summer. Guido can only hope the forecasters are once again wrong.