Nothing before, perhaps throughout history, has devastated the way we live like Coronavirus. From my windows I can see the 358 bus plough up and down the street; it’s often empty. I feel guilty when I break bounds and go for a walk and on that stroll, if I see someone, I apologise to them for being anti-social as each of us takes a wide berth. All conversations including checking on my elderly neighbours across the fence are now done by phone. When I go out for food with my wife every few days, only one of us (Claire) goes into the supermarket whilst I wait in the carpark. If when I am out, I see a police car I wonder if I am transgressing in some way and will I be stopped? My Westminster Office is now effectively in my house and all mail from Parliament is re-directed to Shortlands. Most of us, apart from brave key workers, are effectively entombed at home.
Meanwhile the health of our economy takes a back seat to measures to keep people alive. Our annual debt must be in freefall and all the pain caused to try and balance it over the last 10 years is now very much a secondary consideration. Economic forecasts for the future aren’t worth the paper they are written on.
Nobody really sees what we face after this and nobody knows when lock-down will end. Interestingly the same political pundits in the media that were demanding a lock-down just a month ago are now demanding when it will end. I suppose that’s their job but it does sometimes irk me.
However, I am in some awe about how some parts of industry have adapted so quickly – where it has been allowed to operate, of course. How weird is it that whiskey distilleries in Scotland are now turning out hand sanitisers? The designs of a new breathing aid developed by engineers at the Mercedes F1 team, University College London (UCL), and clinicians at UCL Hospital have been made freely available to support the global response to Covid-19. Burberry is turning over its production to make protective clothing for nurses.
At the same time some local shops, grocers and takeaways are doing brisk trade. In a way they too, like NHS staff, bus and train drivers, care workers, delivery drivers, dustbin men et cetera, have become key workers. I hope we remember them for this – after the trauma ends.
Yet the estimation is that our national unemployment rate is or will go up from 4 to 6 per cent as the crisis unfolds. Huge numbers of people now depend on the Government to keep them going. On the face of it the situation looks rather like the old command socialist economies of places like the German Democratic Republic of East Germany before the Berlin Wall fell in 1990. There the totalitarian Government decided everything including wages and how people lived.
But there is an essential difference. The measures taken by the Government are designed to try and protect the system. Emergency policies to help companies keep staff and for the self-employed are there to try and ensure that we can get back to a normal market economy as soon as possible after the nightmare ends. My goodness I hope that can happen soon.
The Institute for Fiscal Studies has already suggested that the UK will face a budget deficit this financial year of £200 billion — maybe considerably more than that. This crisis is likely to take that debt to over 100 per cent of our GNP.
The Conservative Manifesto for the General Election (was it only 5 months ago?) has been effectively shot to pieces. When this is all over the reckoning will necessitate some seriously difficult economic and political decisions. It is problematic enough now for Rishi Sunak but I don’t envy his job as Chancellor of the Exchequer then either.