Covid-19: Businesses and the Private Sector

Lord Purvis of Tweed Excerpts

Thursday 21st May 2020 Lords Chamber

[Lord Purvis of Tweed (LD)]

I thank the noble Lord, Lord Dobbs, for the debate, and I very much share the sentiments of the noble Lord, Lord Blunkett. We know there will be very serious long-term consequences for many sectors in the UK economy beyond this immediate shock. For example, the Chancellor has already indicated that the self-employed will be likely to pay higher taxes and national insurance contributions next year, while businesses in Northern Ireland will have greater trade barriers because they were misled by the Government. Those are just two examples.

On a wider scale, we know from analysis in the FT that the UK is being and will be impacted greater than many of our competitors because of the profile of the UK economy on top of the contraction of investment, economic flight, and restrictions on labour mobility that we were already seeing as a consequence of Brexit. Our services-centred economy and the flexibility our businesses have had in a liberalised labour market were both highly integrated into our biggest economic market but from 2021, new barriers are being erected to that market.

Therefore, it is imperative that we have information on the core estimates of what the economic and business impact will be of the proposed trade agreement with the EU. When I asked the Government for this in a debate recently, I received subsequent correspondence from the noble Lord, Lord True, for which I am grateful. However, he said:

“The economic impacts of our trade deal with the EU are the subject of a thriving public debate among analysts. It is impossible for a single model, number or scenario to capture that complexity or represent the varying impacts that will be felt across different parts of the economy.”


It seems to be possible to give a model, number and scenario of the impacts of a hoped-for trade agreement with the US, and a hoped-for Japan agreement, but the Government refuse to do so for what is by far our biggest import and export market. It is not acceptable that we go blind into making serious decisions, impacting on our businesses and private sector for the long term, without the Government releasing core estimates of the economic impact of their proposed agreement with the EU.