Middle class to bear brunt of pain from Rishi lifeline

BRITAIN’S middle class will bear the lion’s share of the pain when the multi- billion pound support measures start to be withdrawn, economists say.

Their investments, pension pots and house values will all record a big hit once the epidemic has passed and as Ministers unwind the huge economic stimulus and try to reduce what will have become a colossal debt mountain.

These are findings of a panel of distinguished economists assembled by The Mail on Sunday to look at the likely long-term implications of the crisis.

Pensions look set for three blows, they said. Professor Peter Spencer, of the University of York, said nationalising companies vital to the economy was on the cards, and on terms less generous than those received by bank shareholders during the financial crisis of a decade ago.

‘ I wouldn’t be surprised if the Government t ri es t o separate British Airways from the rest of International Airlines Group and renationalise it,’ he warned those with IAG shares in their pension pot.

Carl Emmerson, deputy director of the Institute for Fiscal Studies, said the crashing stock market had already caused great damage to pension schemes and there was no guarantee share prices would bounce back.

A third blow, said Professor HaJoon Chang, would be the ultra-low returns with the Bank of England base rate at 0.1 per cent.

He added: ‘It is contradictory for authorities to urge people to save for old age then cut the returns to practically nothing.’