LONDON (CU)_The UK economy will be facing a tough road ahead, as the country battles the COVID-19 pandemic, chancellor Rishi Sunak has warned. Nevertheless, the government is taking “the difficult but right long-term decisions for our country”, he told the House of Commons.
Sunak noted that while the new national restrictions were necessary to contain the spread of Coronavirus, these restrictions will have a further significant impact on the country’s economy.
“Even with the significant economic support we’ve provided, over 800,000 people have lost their job since February,” he said.
The chancellor further noted that although the government has been unable to save every job and business, he is confident in their economic plans which continue to support the finances of millions of people and businesses.
According to Sunak, the fiscal stimulus provided by the government so far amounted to more than £280bn, which enabled 1.2 million employers had furlough almost 10 million employees. Moreover, another three million people have enjoyed the benefits of self-employment grants, he added.
The chancellor also assured the MPs that he would “bear in mind” the calls to extend business rate relief and provide further support for the hospitality sector, when he prepares the vital early Budget in March.
However, following these remarks, Shadow chancellor Anneliese Dodds claimed that Sunak is “out of ideas” and providing “nothing new”. “The purpose of an update is to provide us with new information, not to repeat what we already know,” she added.
With the discovery of a new mutant COVID-19 strain in the UK, the country has been reporting a dramatic surge in daily infections and virus-induced deaths. Accordingly, the new widespread lockdown, which imposes a physical shutdown nationwide of hospitality and retail, is likely to lead to a further contraction in the UK economy in the first few months of 2021.
