Britain faces ‘worst slump in our history’
BRITAIN is facing a severe recession the ‘likes of which we have never seen,’ says the chancellor.
Rishi Sunak said the economy may not bounce back straight away and was not counting on the V-shaped recovery many had been hoping for when the country was locked down to prevent the spread of the virus.
Mr Sunak told the Lord’s Economic Affairs Committee: “It is not obvious that there will be an immediate bounceback.” He added that the economy was likely to see a huge downturn.
“Obviously the impact will be severe,” he said. “We are likely to face a severe recession the likes of which we have never seen.”
Shops and many other businesses across the country have closed, sending home eight million employees to pick up 80 per cent of their pay cheque from the government’s furlough programme.
Earlier the Treasury revealed that more than £11.1 billion had been claimed so far through the coronavirus job-retention scheme.
Hundreds of thousands of businesses have received more than £22bn in three government-backed loans from their banks to help them through the crisis.
The schemes cover 90 pc or more of UK turnover and profit, the Chancellor said.
Mr Sunak said the best way to support some of the hardest-hit businesses – such as restaurants – will be to help them reopen.
The chancellor pointed out that some of the worst-hit businesses were those that employ lower earners and young people
“It is critical, both for economic and social justice reasons, that we get those people back to work,” he said.
During the daily Downing Street briefing, the government has put a call out for furloughed workers to help bring in the harvest this summer. Environment Secretary George Eustice said: “Every year large numbers of people come from countries such as Romania or Bulgaria to take part in the harvest, harvesting crops such as strawberries and salads and vegetable,” he said.
“We estimate that probably only about a third of the people that would normally come are already here, and small numbers may continue to travel.
“But one thing is clear and that is that this year we will need to rely on British workers to lend a hand to help bring that harvest home.”
Mr Eustice said that furloughed workers ‘may be getting to the point that they want to lend a hand and play their part, they may be wanting to get out and they may be wanting to supplement their income.’