According to the IPPR half a million employers are at risk of bankruptcy once support schemes are due to close. Economy-wide figures hide those businesses whose reserves are insufficient to cover the lockdown year’s cashflow deficit. The shocking point is: over half-a-million previously viable businesses, employing around 9 million people, are at risk of going bust once taxpayer’s support schemes end.
Business life-support funded by taxpayers can’t continue forever – some estimates put the weekly bill for lockdown at £11 billion – even the most ardent free marketeer accepts the economy can’t go cold turkey immediately. When nations are at war we accept curbs on our liberties with increased command and control of the economy. We are at war with the coronavirus.
The budget in less than 3 weeks has to have a single goal, save and create jobs. Every policy has to be judged by one metric: will this support job creation? Tax rises to pay for the pandemic will have to wait, even the leader of the Labour Party says tax rises risk choking off a recovery. Any talk of tax rises has to be justified against the question; how will this create jobs?
Regrettably the national debt is going to balloon even more. The reckoning will have to wait until the economy is up and running again rather than confined by lockdown to the sofa. Rishi has to forget the deficit and the debt for now to focus on three things; jobs, jobs, jobs.