Sajid Javid MP, the former Chancellor, has joined forces with the Centre for Policy Studies - the leading centre-right think tank - to set out a series of recommendations to Government on how to kickstart the economy and minimise the long-term damage from the coronavirus crisis.
The report, ‘After the Virus’, is the first in a major series of CPS papers on the economic recovery, under the banner of ‘Going for Growth’.
The paper argues that it is now increasingly unlikely that we will see a V-shaped recovery. The impact of the crisis, the need to maintain social distancing, and the hit to consumer and business confidence, represent formidable headwinds to renewed economic growth.
In ‘After the Virus’, Javid and the CPS say that the Government’s immediate priority should be to prioritise growth, rather than derail the recovery with tax rises or spending cuts. They suggest a new fiscal rule in which the Government brings the current budget into balance within three years, but only when a stable recovery has been achieved.
The report argues that any recovery must be based on sound money, a dynamic private sector and low taxes, as well as a renewed commitment to invest heavily in infrastructure to drive growth across the country, and prevent the coronavirus exacerbating regional disparities and stagnant productivity.
The report contains 63 recommendations. Key proposals include:
‘After the Virus’ looks at the pressing problems resulting from the COVID-19 pandemic, but also considers the underlying issues the UK was already facing pre-crisis. These include increasing productivity, levelling up the regions of the UK, boosting business investment, and achieving net zero greenhouse gas emissions.