Restrictions hit UK businesses hard
>>LONDON: Coronavirus cases hit a daily record again on Friday, a day after the UK finance minister effectively abandoned saving hundred of thousands of people from unemployment. A rebellion is brewing within the ruling Conservative Party over new restrictions, which many businesses say will cripple them. A trade deal with the European Union to avoid more chaos is on a knife edge before talks resume this week.
As the pandemic rages and countries across Europe try to respond without throwing their economies back to the Covid-19 wolves, leaders in Spain and France are also feeling the pressure. But for Prime Minister Boris Johnson, crisis is looking more like a permanent state. Few governments face so many challenges on so many fronts.
The sense of foreboding was heightened this week after a U-turn on people returning to offices and curbs on restaurant and pub hours. In August, the government was still subsidising diners to bolster the hospitality industry, a move some scientists suggested may have contributed to spreading the virus.
Business owners are complaining there’s not enough financial support and are shedding staff, while up and down the country radio phone-ins field confused callers wondering about what they can and can’t do now. That’s at a time when the UK is struggling to meet demand for Covid-19 testing just as it heads into the winter flu season.
The problem, said one senior Conservative member of Parliament, is that things are not working inside the No. 10 Downing Street machine — and Mr Johnson needs to get a grip. The question is whether he will get the country through its predicament given the “doom and gloom” the UK faces, the person said, speaking on condition of anonymity.
Brexit talks now head into a critical final round of formal discussions. The question increasingly being asked is if and when Mr Johnson will intervene to rescue a deal after his government declared it would break international law by reneging on a part of its Withdrawal Agreement with the EU. The disclosure caused outrage among Brussels officials and provided fodder for Scotland’s nationalists who want another referendum on independence.
The EU has told UK negotiators they must accept some of the bloc’s key demands over their future relationship if they want to make progress before an October deadline, according to an official familiar with the discussions.
The government in London said last week 7,000 trucks could end up parked in southeast England in a “reasonable worst case” scenario regardless of whether there’s a deal in place when the transition ends on Dec 31. Many companies are now losing hope that a deal will be done and stepping up their contingency planning by stocking up warehouses. In addition, three of the UK’s main supermarkets introduced limits on products like flour and dried pasta on concern people will hoard goods again because of the pandemic.
Disquiet among Conservatives over Brexit and the impact of renewed coronavirus rules on civil liberties has grown as the party heads into its autumn conference starting next weekend.
Charles Walker, vice chairman of an influential committee of the party’s lawmakers, warned the government last week: “If you keep whacking a dog, you shouldn’t be surprised when it bites you back.”
Chancellor of the Exchequer Rishi Sunak on Thursday announced a plan to subsidise wages for the next six months, but the UK’s furlough programme is being phased out. Goldman Sachs economists say the move could throw an additional 2.2 million into unemployment.