Yesterday, from the English market town of Dudley, prime minister Boris Johnson swapped his Downing Street background for an industrial themed one, complete with hard hats and hi-vis vests, as he outlined a “new deal”.
He spoke of “bouncing forwards” and “backwards” (and perhaps over the Irish sea). We were hearing the announcement of the new ‘Build Back Better’ UK coronavirus recovery campaign.
Many were left asking though, how much of this is actually new? Although Boris has snaffled Roosevelt’s “new deal” phrase, his 2020 version is not nearly as far-reaching as its 1933 namesake. Boris’s “deal” is equivalent to 0.2% of GDP, unlike Roosevelt’s, which represented 40% of the US 1929 GDP.
Amidst the hyperbole, there were some announcements. He said that the government wants to continue to “level up”, that infrastructure projects in England would be “accelerated”, and that there would be investment in new academy schools, green buses and new broadband. No new money was allocated for hospital maintenance, bridge repairs and home building.
The facts are clear, and they are sobering. Yesterday, the Office for National Statistics (ONS) revealed that in the first quarter of this year, the UK economy shrank by 2.2%: the joint largest fall since 1979.The government is due to end the furlough scheme in October – a scheme that is currently paying the wages of 9.3 million people – but no aspect of the so-called “new deal” addresses these jobs post-October.
For there to be any hope of recovering from this momentous crisis, we need huge amounts of new money to be pumped into our economy and perhaps just as importantly we need a wave of reform, innovation and collaboration across government, businesses and the third sector that isn’t driven by money but by leadership. All eyes on Chancellor Rishi Sunak now, who is due to announce a package of strategic tax cuts and spending on 8 July.