Daily Covid-19 Brief: Wednesday, May 13

Each day, our Public Policy team will be reporting on the latest news in the evolving situation. To view the previous day’s summary, please click here.

Office for National Statistics have said the UK economy shrank at its fastest pace since 2008 in first three months of the year

• ONS data showed that the UK economy shrank by 2% in first quarter and shrank 5.8% in the month of March when the lockdown began.
• However the UK economy did not contract in the first quarter as fast as France (5.8%), Italy (4.7%), Spain (5.2%) or China (6.8%). However this is suspected to be down to the fact that the UK went into lockdown later than all of those countries.
• The UK is expected to catch up when its second quarter figures are published later this year.
• It comes as a leaked Treasury document suggested that the Government is considering tax rises, public spending cuts, green levies and public sector wage freezes as a way to meet the multi-billion pound cost of the COVID-19 crisis.
• It has been reported that Treasury scenarios predict the UK will end the year with a £337bn budget deficit.
• The report suggested that tax rises and spending cuts that would raise up to £30 billion may be needed to help fund the increased level of debt.
• The report predicted that a two-year public sector pay freeze could save £6.5 billion by 2023-24, while axing the pension triple lock could save £8 billion a year.
• However Transport Secretary, Grant Shapps, said he did not recognise the figures and promised “we are not going back to the world of austerity”.

The Government announced guidance to reopen the housing market

• The Housing Secretary Robert Jenrick announced a plan which set out how the Government plans to re-start the housing market.
• From today, Estate agents’ offices can now open; viewings are permitted; show homes can open and removal companies and other essential parts of the sales and letting process have been re-started.
• The Government has also issued new guidance alongside the Home Builders Federation, aimed at enabling home builders to return to work safely.
• Guidance will allow for extended working hours on construction sites and measures have been introduced to make the planning system operate remotely again.
• During this afternoon’s Number 10 briefing, Jenrick said that the Government’s First Homes programme will, later this year, provide homes at a 30% discount for local first time buyers and key workers.

Government announces establishment of taskforces looking at reopening the economy

• The Government announced today the establishment of five ministerial-led taskforces looking at how to reopen sectors closed due to COVID-19.
• The taskforces will look at developing “new Covid-19 secure guidelines” to reopen businesses where close contact between people is unavoidable.
• The taskforces announced today are:
  • Pubs and restaurants – led by the Department for Business, Energy and industrial Strategy
  • Non-essential retail, including salons – led by the Department for Business, Energy and industrial Strategy
  • Recreation and leisure, including tourism, culture and heritage, libraries, entertainment and sport – led by the Department for Culture, Media and Sport
  • Places of worship, including faith, community and public buildings – led by the Ministry for Housing, Communities and Local Government
  • International aviation, reflecting the unique challenges that sector is facing – led by the Department for Transport
• The taskforces will help facilitate the gradual reopening of these sectors.

 Johnson and Starmer clashed over advice issued to care homes

• Sir Keir said the Government had been “too slow to protect people in care homes” after figures from the Office for National Statistics (ONS) showed at least 40% of Covid-19 deaths in England and Wales occurred in care homes.
  • Sir Keir said that up until 12 March, care homes were being told it was “very unlikely” anyone would become infected.
  • In response, Johnson stated that this “wasn’t true”.  However, up until the 13^th March Government advice stated that “It is therefore very unlikely that anyone receiving care in a care home or the community will become infected.”
  • Sir Keir wrote to the PM to ask him to return to the House of Commons to correct the record. However, Johnson said that Starmer had “selectively and misleadingly” quoted Public Health England.
  • The Commons clash came as the Prime Minister announced an extra £600m for infection control in care homes. 

Other UK COVID 19 news 

• The Government’s Self-Employment Income Support Scheme has gone live. From today, millions of British self-employed workers will be able to apply for one-off grants of up to £7,500, as part of the government assistance package.
• The Leader of the House of Commons Jabob Rees-Mogg has told the House of Commons that MPs should prepare to return to Westminster within weeks. Rees-Mogg said that he sees the temporary arrangements, set up to manage the coronavirus pandemic in Westminster, ending in early June.
• MPs in the House of Commons are preparing to hold their first binding virtual vote later today. MPs will be voting on the final stages of the Agriculture Bill.
• New guidance issued by the College of Policing says officers in England have “no powers” to enforce two metre social distancing. It says that government guidance – which also includes advice to avoid public transport and wear face coverings in enclosed spaces – is not enforceable.

World COVID 19 news

• Germany is looking to reopen many of its borders as it continues its loosening of lockdown measures. The German Interior Minister has confirmed that Germany intends to return to normal border operations by June 15. Crossings with Luxembourg will be lifted on Saturday, and similar unrestricted passage could soon be revived with Denmark.
• The European Commission has set out guidance for EU countries to resume travel and tourism from this summer onwards. Recommendations include ending blanket restrictions on free movement and replacing them “gradually” with more targeted measures.
• New Zealand has reported zero new COVID-19 cases for the second day in a row. From midnight, the country is preparing to ease many of its lockdown restrictions.
• South Korea is continuing to ease restrictions despite the new outbreak in Seoul. South Korean health authorities have said they have no immediate plans to reinstate strict social distancing rules and broader restrictions are being eased.

Private sector updates

• A survey from the Federation of Small Businesses showed that one in three companies that have temporarily shut during the lockdown fear that they may never reopen. Seven in ten of the respondents to the survey of more than 5,000 companies state that they are using the state furlough scheme.
• Travel firm Tui has pledged to “reinvent the holiday in 2020” as it looks to reopen selected hotels in European destinations ready to welcome holidaymakers. However, it warned that up to 8,000 jobs will go as it seeks to cut costs by 30% in a major restructuring.
• Aston Martin has announced a £119m loss in Q1 2020, with 45% fewer cars sold than a year previously.
• Virgin Atlantic have announced plans to fly to 24 destinations in 2021 after Richard Branson sold £405m of shares in his Virgin Galactic space venture to save the flagship airline.
• UK cinema chain Vue, have released plans detailing how it will reopen its cinemas under social distancing measures. Measures include staggered screening times, enhanced cleaning and physical distancing of customers.
• McDonald’s, Greggs and Subway have stepped up plans to reopen outlets; McDonald’s plans to reopen all of its drive-through restaurants by early June; Greggs has reopened a number of shops in the north-east; whilst Subway is planning to reopen 600 of its 2,600 UK stores.
• Marks & Spencer is to reopen 49 of its cafes in the UK from Thursday. The cafes will be offering takeaway food and drink.