Government responds to second report on economic impact of coronavirus (COVID-19)

Government responds to second report on economic impact of coronavirus (COVID-19)

The Treasury Committee has published the government’s response to its second report on the economic impact of coronavirus (COVID-19). In its response, the government asserts that throughout the pandemic its economic priority has been to ‘protect people’s jobs and livelihoods’, noting that it has spent over £200bn to 'protect jobs and businesses’. The government further outlines the measures it has and is continuing to implement to support individuals and businesses (such as extending the Coronavirus Job Retention Scheme). The government's response also addresses a number of the recommendations raised by the Committee regarding universal credit, recapitalisation of SMEs, kickstart and levelling up, with the government saying on the latter that it is ‘committed to levelling up opportunity in every region and nation of the UK and levelling up represents a common priority across departments, both in what they do and how they do it’.

Chair of the Treasury Committee, Mel Stride MP, said: ‘Whilst many things have changed since we published our report in September, including the development of vaccines, many of our recommendations remain.

The end date for the Job Retention Scheme has been pushed back by up to five months, but the case remains that the Chancellor should carefully consider targeted support to sectors hardest hit by the restrictions put in place to combat coronavirus.’

He added: ‘We welcome the Government’s emphasis on ‘levelling up’ the economy. But the slogan is still yet to be defined. The Government should publish a strategy underpinning it, including clear objectives and indicators.’

In relation to the insurance sector, the report states that HM Treasury is working with insurers, trade bodies and regulators to 'understand what can be done to help businesses'. It states that HM Treasury is 'in close contact' with the Prudential Regulation Authority following the test case judgment to 'monitor the solvency of the insurance sector'.

The Treasury Committee’s report can be read here.

The government’s response can be read here.

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