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‘Right The Ship’
Rishi Sunak has won high praise for his response to the economic carnage coronavirus threatens to inflict, helped by some adroit turns of phrase that seem to answer the concerns of the nation – think “whatever it takes”.
But his revival of George Osborne’s doomed claim that “we’re all in this together” will have had hearts in mouths at Tory HQ.
That’s because it came on the day the Office for Budget Responsibility predicted two million potential job losses, a 35% hit to GDP in one quarter, and the largest single year public deficit since the second world war.
The jaw-dropping scenario sparked inevitable questions of whether there could be further economic pain for years to come as Sunak tries to balance the books.
So reviving Osborne’s much maligned defence of austerity as a response to the 2008 crash in the context of a new economic downturn was a risky move.
In the first admission that difficult decisions will be required once the immediate health crisis is out of the way, Sunak also made clear he would eventually “take stock of public finances and the economy and make the right decisions at that point”, speaking of a need to “right the ship”.
But what followed suggested it could be different this time.
Sunak, a big supporter of free markets, has repeatedly rejected “ideology or orthodoxy” in dealing with the crisis, and will have delighted Boris Johnson with his insistence that ministers remain “very committed” to the big-spending “levelling up” agenda the Tories won the election on just four short months ago.
The chancellor even refused to commit to maintaining the triple-lock on pensions, a holy grail that previous governments have not dared touch since it was introduced by Osborne, describing it as a decision for “future Budgets”.
When Sunak topped it off with an “enormous tribute” to young people’s sacrifices during the coronavirus crisis, we perhaps got a glimpse of how this chancellor could operate beyond the pandemic.
“If you’re young and entering the labour market I want you to look forward and see opportunity and hope for your future,” Sunak said.
For the millennial generation which is grappling with the prospect of two “once-in-a-generation” economic downturns, he has set himself a challenge which could last the length of his chancellorship.
Quote Of The Day
“This is going to take months to really win the war on coronavirus,”
– Work and Pensions Secretary Therese Coffey.
Cheat Sheet
Unemployment could increase by two million and UK GDP could fall by 35% in the second quarter of 2020 as a result of the coronavirus pandemic, the Office for Budget Responsibility (OBR) has said.
The number of people who have died in UK hospitals after contracting coronavirus has risen by 778 in 24 hours to reach 12,107.
Nicola Sturgeon has said it would be “unconscionable and unacceptable” if England were getting priority for personal protective equipment (PPE). Downing Street has flatly denied that England is getting and special treatment.
Labour chiefs are hunting down the source of a leaked report on anti-Semitism that named a string of party officials and complainants.
What I’m Reading
Millennials Don’t Stand a Chance | The Atlantic