In conversation with Rt. Hon George Osborne CH. Editor, Evening Standard. How well is the Government managing the Covid-19 crisis?

In conversation with Rt. Hon George Osborne CH. Editor, Evening Standard. How well is the Government managing the Covid-19 crisis?

24.04.20

Tulchan Frameworks, hosted by James Harding, Co-founder and Editor, Tortoise Media, in conversation with George Osborne, Editor of the Evening Standard and former Chancellor of the Exchequer.

Main discussion points:

Public opinion

The Government is more popular than any in living memory, enjoys tremendous public support (which was especially strong when the Prime Minister was seriously ill) and, to date, has been given the benefit of the doubt. It has been remarkable to watch a major industrial democracy agree so readily to lock itself up and close down its economy. It is also quite wrong to claim the public is itching to end the lockdown. But the politics of the pandemic will become thornier as the economic crisis and the complexities of leaving the lockdown - when we do - take their toll.

Rishi Sunak’s strategy

Clearly, there have been problems with some aspects of the plan: in particular, the Government should have guaranteed 100 per cent (rather than 80 per cent) of loans delivered by banks to SMEs. But the more important question is: how long can this extraordinary (and extraordinarily expensive) rescue régime be maintained? In practice, it might be hard for the Chancellor to pull the plug before the autumn - and, whenever he does, there will be a surge in unemployment that will present serious social and political challenges.

Phased lockdown exit

Nicola Sturgeon is right to invite the voters on a candid journey in which the trade-offs are spelt out. Straight talking will pay off at the UK level, too: ministers should explain that a phased relaxation of the restrictions is the only practical way forward and that the Government’s objective is both to handle the pandemic and to save jobs, restore pre-lockdown levels of cancer referrals, prevent a crisis of mental health, and so on. It is not enough to announce decisions.

Public finances

The Government will need a credible fiscal plan to underpin future economic confidence. This will not be what people want to hear - but it is true nonetheless. The UK must be visibly and energetically open for business. This means attractive levels of corporation tax, a continued commitment to infrastructure (HS2, the Northern Powerhouse, expansion of Heathrow) and a strategy to deal with both with debt and the deficit. This will be especially difficult for a government elected to end austerity.

Boris Johnson

There are some governments in which senior figures are universally recognised to speak with the authority of the Prime Minister. This is not one of them. The PM’s return to work will be essential for the next round of (very difficult) decisions.

An electable Labour Party

After five years, the return of a functioning Opposition is to be welcomed and will keep the government on its toes precisely when it most needs intelligent and vigorous scrutiny.

The longer term

One of the legacies of the pandemic will be a reconsideration of the social contract - including the social responsibilities of business. Those companies which were bailed out will be asked: the state was there for you. How will you be there for the state? In particular, the continued use by companies of complex tax shelters will be to invite pariah status. The rules of the game, as in so many respects, will change.