Kate Andrews has done a great job in the Telegraph reminding readers that a major source of our current economic malaise – now approaching the highest tax burden since records began 75 years ago – is the cost and impact of the Covid lockdowns, a price which must never be forgotten. Here’s how she begins.
Ideally we’d never talk about lockdown again. We’d consign those draconian years to the history books and get on with normal life.
Unfortunately, there remains far too big a mess to clean up to bury those memories completely. The thousands of children who never returned to school, the millions of people on NHS waiting lists – these are people we must not forget.
But some lockdown legacies are discussed more widely than others. Those waiting lists are a big part of the public debate, rising to 7.6m (and counting) in England.
Lost learning also remains pertinent, as other impediments to schooling this year kept it in the news. Teacher strikes and crumbling school buildings provided cumulative reminders that, between March 2020 and April 2021, pupils were estimated to have had their learning hours reduced by a third.
What we don’t talk about as much are the long-term spending ramifications of the pandemic. …
It suits every political party not to talk about the longer-term spending trajectory Covid has set us on. If you dare look at where we’re headed, it becomes impossible to keep up the pretence that the sums of money we’re spending, or the promises we continue to make, are in any way sustainable.
There’s an irony in political discourse: that as our spending trajectory has gone off the deep end, both the Conservatives and Labour have adopted the language of fiscal responsibility.
This has always been Rishi Sunak’s selling point: that he is ready to make difficult decisions to get the books (somewhat) balanced.
Labour, while light on detail, has largely promised to do the same and has even been willing to take some political pain (like watering down its £28bn pledge on green investment) to show that it is serious about making the numbers add up.
But that language is not lining up with policy. The aftermath of the pandemic has created far greater demand for health and welfare than can be met, even with rising tax receipts that reflect the highest tax burden in over 70 years.
The number of people out of work due to long-term sickness has increased by roughly half a million, taking the total to 2.6 million; the number of people on out-of-work benefits since the furlough scheme has risen to over five million.
Include rising pension payouts and the total nominal welfare bill is projected to increase by 16% between now and 2027-28, according to the Department for Work and Pensions.
Meanwhile, the NHS bill is only going up, set to amount to 44% of all day-to-day public spending in just a few years’ time.
With access to healthcare already so appalling – going into flu season no less – and the ongoing doctors strikes further deteriorating services, it’s near impossible to see how the £13bn promised for social care ever ends up being redirected away from the health service.
These are the practical spending problems that lockdown has created, but they only begin to highlight the financial mess we’re in.
The trouble is, says Andrews, thanks to the lockdowns “we have entered an era where demand for government intervention is sky-high”.
“No one is fixing the roof when it’s raining or it’s shining,” she adds.
Worth reading in full.