Covid-19: Economic Impact of Lockdowns

Debate between Taiwo Owatemi and Esther McVey

Tuesday 29th November 2022 Westminster Hall

[Esther McVey]

My hon. Friend makes the point eloquently; I hope he will make a speech later, fleshing out his comments.

By February 2022, inflation had already surged, with the consumer price index hitting 6.2% in February, after which, without doubt, the war in Ukraine added to the problem. As it stands today, we have unprecedented inflation and costs of living.

None of that should come as a surprise. In fact, the Imperial College report of March 2020 that recommended lockdowns specifically said that the

“economic effects of the measures which are needed to achieve this policy goal will be profound.”

While many people talk about the cost of covid, it is actually the cost of lockdown and lockdown rules that need to be questioned.

The Government have spent in the region of £400 billion on the covid-19 response, which has taken the national debt to over £2.1 trillion. To make matters worse, we know vast sums of money were wasted. For example, seven Nightingale hospitals were built in England, which was an impressive achievement completed in record time. However, most of them were hardly used in the way intended and they cost more than £530 million. The Yorkshire Nightingale closed before ever seeing a patient. Elsewhere, an eye-watering £673 million was spent on unusable personal protective equipment items.

The £70 billion spent on furlough and £84 billion on business support schemes softened the blow for a while. However, the Federation of Small Businesses still warned of a ticking time-bomb, with 500,000 owners of small businesses—the backbone of our economy—at risk of going bust within weeks.

[Taiwo Owatemi (Coventry North West) (Lab)]

In my city of Coventry, many small businesses were hit considerably by covid and are still being hit because of the cost of living crisis. Does the right hon. Lady agree that in order to continue to support our small businesses given the turbulent year that they have had, we need to reform business rates and invest in our high streets, and we also need to ensure that our small businesses are given the support needed for them to be able to compete effectively with online giants that have been able to make hay during the covid-19 pandemic?

[Esther McVey]

I am a massive fan of small businesses, enterprise and those people creating wealth in their communities, and we will have to support them. Also, I will pause for a moment to reflect on all those small businesses that did not get support during the pandemic, which are known as Forgotten Ltd, and they also need support going forward. We again have to create a dynamic world and a dynamic UK for these private enterprises.

Vacancies are now at a record high as people elect to resign from the labour market, which is known as “the great resignation”, and because there are those other people who are now classed as being economically inactive. This is something that we could not have foreseen as we furloughed and closed the country down, but again it is a consequence of the lack of debate, probing and questioning at the time.

It is finally time to publish the much talked-about but still missing cost-benefit analysis that led to the nation being locked down, and to have full disclosure about the facts that were available. Let us review the list of experts on the Scientific Advisory Group for Emergencies, or SAGE, and on other advisory committees. Going forward, let us ensure that there is transparency about the members of these groups, as we have for MPs, such as their political affiliation and the financial support they receive.

All eyes are on the covid-19 inquiry for impartiality and a diverse range of experts to give evidence. We need integrity and clarity, and the policy of lockdown needs to be assessed honestly and fully. However, today I call on the Minister—the Economic Secretary to the Treasury, my hon. Friend the Member for Arundel and South Downs (Andrew Griffith)—to release the much-awaited cost-benefit analysis of lockdown.