Britain’s government is set to unveil a new set of financial measures to help the economy tackle the impact of the coronavirus pandemic.
So far, more than 1,500 people have tested positive for the virus in the UK and 55 people have died. However, if everyone was tested, the actual number of cases is estimated to be between 35,000 and 50,000, according to authorities.
The news of fresh financial stimulus measures come a day after UK prime minister Boris Johnson unveiled the new direction the nation is going in on tackling the coronavirus, which is set to have a major impact on businesses.
He made a switch from the ‘mitigation’ strategy to the ‘suppression’ strategy. The first involves home isolation of suspect cases and their family members but allows the rest of society to roam about freely and no restrictions are put on others.
However, the Imperial College Covid-19 Response Team, which advise the government, found that the strategy previously being pursued by Johnson and his cabinet would result in the deaths of hundreds of thousands of people. They therefore recommended the UK government to switch to the ‘suppression’ strategy, which will lead to restrictions on wider society.
At a press conference on 16 March, Johnson urged everyone to avoid unnecessary social contacts and to work from home where possible — but stopped short at an outright ban like other countries such as Germany.
He also told people to stay away from pubs, restaurants, as well as other entertainment venues like cinemas and theatres. Already theatres and music venues around the UK said they would be closing until further notice and restaurants are on the brink of extinction.
On 17 March, the British Chambers of Commerce (BCC) warned that the coronavirus pandemic is going to further weaken UK economic growth this year, in combination with Brexit.
The lobby group, which represents 75,000 businesses in all sectors, said in a statement that it expects UK economic growth to “slow sharply” in 2020 and has therefore downgraded its UK GDP growth expectations for the year to 0.8%, from the previous forecast of 1.0%.
The new financial measures are set to be on top of those announced last week, when Britain had a different strategy towards tackling the pandemic.
Last week, UK chancellor Rishi Sunak announced a £30bn coronavirus spending package, which included a £5bn emergency response package for the NHS, £2bn has been set aside to cover up to 14 days of sick pay for employees at businesses with fewer that 250 employees as well as £500m will be provided to local authorities to directly support vulnerable people.
Business-wise, the UK government pledged the abolition of business rates for retail, leisure, and hospitality firms that have a rateable value of less than £51,000 as well as a £3,000 cash grant for around 700,000 of the country’s smallest, eligible businesses.
The Bank of England also announced emergency measures the same day, in response to the economic impact of novel coronavirus, including an unexpected interest rate cut from 0.75% to 0.25%.
It also announced a £100bn funding scheme aimed at maintaining bank and building society lending to small and medium-sized businesses, amongst other measures.