Spending will save us from Covid doldrums

QUITE apart from the immense damage done by Covid to our health, the virus has inflicted a terrible toll on the economy.

Restrictions to stop the bug’s spread foreshadowed Britain’s worst slump in 300 years. Businesses are toppling like dominoes and, once furlough ends, millions will be consigned to the dole.

Mercifully, this gloomy cloud has a silver lining. For as the Bank of England’s chief economist reveals in today’s Mail, bank accounts are bulging with record savings.

During lockdown, with fewer outgoings and less chance to spend, households have built up a £100billion treasure chest – a whopping five per cent of GDP.

Some of course is squirreled away as a cushion against unemployment or pay cuts. But the vaccine, coupled with loosened restraints, promises to unleash a tsunami of pent-up spending.

The Bank believes hordes of consumers, keen to put this year’s grim privations behind them, will embark on an ecstatic spree of retail, restaurants and travel.

(Indeed, tills were jingling at the weekend as Christmas shoppers took a break from online orders and flocked to the High Street). In tandem, a surge in business confidence could trigger bumper investment with potentially stunning results. Yes, tough times lie ahead. But if the Government swiftly hands back our freedoms, Britain’s indomitable army of spenders can light the economic touchpaper, dragging us from the doldrums of despair to a remarkable recovery.