Britain needs urgent exit plan to lock Covid-19, think tank says
The UK urgently needs an exit plan for locking out the coronavirus, a think-tank warned, saying the UK tax forecaster had “minimized” the long-term crippling effects on the economy.
The Adam Smith Institute has accused the budget watchdog, the Office for Budget Responsibility (OBR), of underestimating the long-term effects of blocking and shutting down a third of the economy.
He said the OBR scenario analysis released earlier this week did not take into account the risk of systemic economic decline if the UK foreclosure were maintained.
The OBR predicted that the economy could contract by 35% and unemployment could increase by 2 million if the foreclosure continues for three months followed by a partial lifting for three months – but its analysis did not assume any consequences. economic sustainability.
The institute warned that the UK is lagging behind other countries that have already implemented reopening strategies and deadlines, such as Germany, Italy, Norway, Austria , Spain, Denmark and the Czech Republic.
He said this prevented UK companies from planning for the recovery after the lock-in restrictions were relaxed.
Matthew Lesh, head of research at the Adam Smith Institute and co-author of the report, said, “Limbo must end.
“The shutdown of a third of the economy has been necessary to slow the spread and protect health services – but it cannot last forever.
“We need a way out of this mess: a strategy to protect ourselves from this virus while allowing life to gradually return to normal.
“This will involve an increase in testing and tracing capabilities, maintaining physical distance in shared spaces, but allowing as many businesses as possible, as quickly as possible, to reopen their operations.”
Britain should consider preparing for a gradual reopening and a reduction in state support for the economy, according to the free market think tank.
He stressed that the lockdown should only be lifted once clinicians have informed that the epidemic is under control, but added that an “open and transparent” exit plan would help secure public support for the measures. of social distancing.