LACA view

Overview

The PM held Cabinet talks this morning about easing the lockdown. Downing Street has confirmed that there is no fixed date for the wider launch of the NHS contact tracing app but it will be rolled out in the coming weeks. The Education Secretary Gavin Williamson confirmed that all schools would not reopen by the summer holidays but the intention was for all schools to come back in September.

Health Minister Helen Whately has drawn criticism for appearing to suggest that the Government could blame the scientists in SAGE for mistakes in managing coronavirus in care homes. On Brexit, Paymaster General Penny Mordaunt confirmed that the Government would not be asking to extend the transition period.

The PM responded to the Black Lives Matter protests with an article in the Voice acknowledging the “incontrovertible, undeniable feeling of injustice” motivating the rallies, while condemning those who have flouted social distancing to attend them during a “time of national trial”.

HM Treasury has revealed that 8.9 million workers are now covered by the furlough scheme, a quarter of the UK workforce. In addition, 2.6 million claims have been made for the self employment support schemes. The OBR expects annual borrowing to reach 15.2 per cent of the UK economy, the highest figure since the 22.1 per cent seen in WW2.

Daily Press Conference

The Press Conference was led by BEIS Secretary Alok Sharma accompanied by the Chief Executive of the Health and Safety Executive Sarah Albon. The figures are as follows:

• 5,870,506 tests have been conducted.
• 102,930 tests yesterday.
• 289,140 people have tested positive.
• 1,387 cases confirmed as of 9 June.
• 40,883 of those tested positive across all settings in the UK have died.
• 50,107 deaths registered with Covid on the death certificate.
• 62% of registered covid deaths have happened in hospitals and 31% in care homes.
• 286 additional deaths since yesterday.
• 446 estimated hospital admissions with covid in England.
• 513 patients with covid are on ventilators.
• 6,348 people in hospital with Covid, down from 7,622 last week.

BEIS Secretary Alok Sharma confirmed that non essential retail outlets that were required to shut can open again on 15 June 2020 (in England) provided they adhere to the guidelines. He thanked people who worked in essential retailers for their work during this crisis. The guidance published on 25th May has given businesses enough time to get businesses Covid 19 secure. Shops should reopen when they can follow these guidelines.

Every business that opens must complete a Covid 19 risk assessment. Businesses should visibly show that they have taken steps to assess the risks and manage it. The authorities will undertake checks and can use enforcements orders for those that don’t. He stated "as soon as we can we will publish safer working guidance for restaurants, pubs and bars." The ambition to reopen these businesses from the 4th July 2020 at the earliest.

Starting this week the BEIS Secretary will lead the 5 roundtables and will consider policy measures to secure economic recovery. These take on an even greater sense of urgency and importance. Will work shoulder to shoulder with these businesses in the next stage of the fightback. The aspiration is to build a fairer and greener economy.

Answers to Questions

• On 2 metre rule: Worst thing is to have a second peak. Will keep the 2 metre rule under review.
• Prevalence in society and the chance of it being passed on at certain distances will impact decisions around the social distancing 2 metre rule.
• On pubs reopening: Will publish guidance for the pubs sector ahead of time and are putting it together now and having discussions. On the decision to re open Mr Sharma said they would continue to look at the R.
• Guidance for pubs: It is safer to work side by side for example rather than face to face, this guidance for pubs will be published soon.
• On China: The BEIS Secretary said he would not pre-empt what would be in a forthcoming bill regarding Chinese control and investment in key infrastructure.
• Local virus upticks: Will identify where there are local flareups and take action as the Government have done in Weston Super Mare.

Statement on school re-opening by the Education Secretary

Meanwhile, Education Secretary Gavin Williamson gave a statement to Parliament on the ‘Wider opening of education and early years settings.’ The Government has delayed the full re-opening of schools. He thanked those working in education for the huge efforts they are making.

The Education Secretary has confirmed that not all primary school children will be able to return for a full month of class time before the summer holidays begin. He stated the cautious phased return was the correct approach to take. He wanted schools that can do so to bring children back to school pre summer holidays, the Government were working to have all pupils back at school in September.

Nurseries and other early year providers have now welcomed back pupils of all ages. Last week was the first week that schools in England began admitting children in nursery, Reception, Year 1 and Year 6. Only 52 per cent of English primary schools opened to more children last week. The pupil attendance rate in nursery and primary schools was 11 per cent on Thursday last week.

Schools will need to restrict class sizes to 15 pupils or less, have frequent hand washing and maintain social distancing. There will be a test and trace approach where children are suspected of having the virus. The Government recognise that schools need time to put in place the restrictive policies the Government has asked for. They are allowing headteachers ‘flexibility’ to act ‘how they feel best.’

They will close schools down in small clusters when there is an outbreak but the advice from SAGE is that it is ok for schools to reopen. From 15 June secondary schools and colleges will provide some additional face-to-face support for years 10 and years 12 and 16 to 19 students. The Government is under pressure to provide catch up support, particularly for children from poorer backgrounds.

Separately, Education Select Committee Chair Robert Halfon said it was strange to prioritise opening pubs over schools. Shadow Secretary of State Rebecca Long Bailey pressed the Home Secretary to extend free school meals over the holiday period.

Treasury Select Committee Oral evidence session on the ‘Economic Impact of the Coronavirus’

In attendance were:

• Torsten Bell, Chief Executive, Resolution Foundation
• Paul Johnson, Director, Institute for Fiscal Studies
• Dr Gemma Tetlow, Chief Economist, Institute for Government
• Giles Wilkes, Senior Fellow, Institute for Government

Key points to emerge from the session were as follows:

• Business Debts and the recovery: At budget, the Chancellor may look at how to prop up viable companies that are loaded up with debt. We will rely on these companies to invest to generate the jobs we need to recover and they won’t if they have high debts.
• The tax structure: Will need to think about the structure of the tax system, might be short term stuff on stamp duty but also need to sustainably fund healthcare etc.
• Second Spike: If there is a 2nd lockdown then support schemes will be less generous because won’t be able to afford it. Need to look at the sectors that won’t come back under that scenario and look at re-training.
• Economic response to the crisis: Unlike previous crisis – not an economic cause of this, this is a state action and about health policy, so not a clear economic solution. There is not a health v economy trade-off as much as suggested because health fears affect peoples economic behaviour regardless of the lockdown.
• Governments Coronavirus Tests: The Government’s 5 tests only focus on coronavirus and not on other factors e.g. the economy and the potential for deaths from other causes. This makes it difficult for business to plan.
• Business Loans: This is a liquidity issue, so the Government correctly decided to get the money out there and can claw it back later if need to. However, a lot of these loans won’t be paid back and this is worrying – don’t want to support businesses that are not viable. 
• Business support and its design: We do not have as much direct lending from the Government to business in normal times so the UK less equipped to provide support so response from the Treasury has been quick. It has not been that flexible once the schemes have been set up with the exception of the loans programmes.
• Commercial rents: Income rents are possible so share the burden of this with landlords etc but ensure that if a business becomes profitable more quickly then it begins to pay full rent at the same time. This could also be the case for business loans going forward (Torsten Bell, Resolution Foundation)
• Apprenticeships: Maintaining the level of apprenticeships will be a big challenge and will need investment in this. Support that links employers and training are more effective than Government training schemes.
• Employment: The level of employment is unlikely to come back quickly as the historic experience is that it takes a while to return. Sectors like hospitality are the sectors which get people back in to work and they are not going to come back in the same way because of the health measures.
• Pensions Triple Lock: OBR predicting average earning falls of minus 7% this year but then next year there will be an 18% increase in earnings and that will not happen so it will change.
• Sectoral impact: In the case of manufacturers 36% plan to reopen in the next 2 weeks, in food it is 12% and more manufacturers stayed open in the 1st place. One of the key issues is about level of future demand for their services, giving them more time to realise where it will settle is key.
• Government Departments and quangos: DWP and HM Treasury have rolled out programmes quickly and well but Public Health England has not.
• Tax and Spend Priorities: In last consolidation, the approach was looking at how much we can borrow and the political considerations around tax and then spending was what was left over. Now it is possible that people will look at how much they want to spend and then look at how to fund it.

Government Announcement

• The Department of Health have launched a new study to monitor the prevalence of COVID-19 in schools, The new voluntary coronavirus (COVID-19) study will assess and monitor the prevalence of COVID-19 among pre-school, primary and secondary school pupils and teachers.