Coronavirus live news: UK budget will set out plan to address economic damage; US approves Johnson & Johnson jab

1 month ago

Dodds and Sunak are also on the Andrew Marr show, Dodds first. She reiterates the point about it being the wrong time to focus on tax rises and says there should be a focus on stamping out waste and mismanagement, and on securing jobs for the future, “otherwise the chancellor will have less to tax in the first place”. Again, she says Labour will look favourably at a long-term plan for changing the corporation tax regime but adds “I would be concerned about additional taxes on business right now.”

Here’s a clip:

BBC Politics (@BBCPolitics)

#Marr: Will Labour support raising corporation tax?

Shadow Chancellor Anneliese Dodds: "If there's a long-term plan… we would look at that favourably"

Budget 2021 https://t.co/93Gj5WDclS pic.twitter.com/mYvvTdOyNZ

February 28, 2021

Marr points to backbench anger at the prospect of Labour voting against corporation tax rises. She says that businesses are “really concerned about confidence” and says that former party chairman Ian Lavery, quoted by Marr, has “got this one wrong”.

On furlough, she says the scheme must be reformed to include training and that abuses within the scheme must be stamped out. She says the chancellor should be clear that as long as there are health-based restrictions which impact demand, wage support should be available. She also says the £20 uplift in universal credit should be maintained but that universal credit should in the long term be subject to radical reform. She declines to say the £20 should be maintained in perpetuity because she wants to reform the system.

Marr asks if Labour is too timid in its strategy for taking on the government. Unsurprisingly, Dodds says no, it isn’t. And that’s it.

Updated at 4.29am EST

Asked about proposals by her predecessor, John McDonnell, for a windfall tax on companies that have profited from the pandemic, Dodds says the government “should be focused on protecting jobs and businesses”.

Again she says that discussions about tax rises should be for the future. She declines to say she would support any tax rises in this budget. The state of the public finances is a concern, she says, but “we have to focus on the size of the tax base … it’s really important that we build that economic activity back up. That’s what’s happening in other countries.” She says Sunak is “well out of the mainstream” on increasing taxes.

Updated at 4.25am EST

Anneliese Dodds.
Anneliese Dodds. Photograph: Sky News

Anneliese Dodds is now being interviewed on Ridge. Labour wants to see “an absolute determination to protect jobs and businesses in the UK … not any party political considerations about what’s best for the Conservative party at the next general election.”

On reports that Sunak will increase corporation tax and Labour will oppose them, Dodds says the government has “pulled our country further and further away from the mainstream on corporation tax” but that in the short-term the government is trying to get any increases “out of the way quickly”. She says the UK has had the worst economic crisis of any major economy.

Pressed on why Labour has apparently changed its position on corporation tax, she says Labour would welcome a “longer-term debate around corporation tax” but asks “why are they focused on this now? Why are they focused on increasing council tax directly for families right now? … because the chancellor has said to his MPs that he wants to get tax changes out of the way now so that he can have a clear run through to the next election … it seems to be driven by party political considerations”.

She says Labour would back serious long-term proposals on tax but says “what we don’t want to see right now is what the chancellor is doing particularly in relation to council tax, the imposition of additional costs right now at a point where our country is experiencing the worst economic crisis of any major economy”. She declines to say Labour would vote to support higher corporation tax.

Updated at 4.25am EST

Sunak is asked about evidence that his Eat Out to Help Out scheme played a part in extending the pandemic. “There are many different studies … and I don’t agree with that,” he says, saying it is a “bit odd to ascribe causality in that way” given, he says, the rises in infection rates did not match the areas where the scheme was most used. That’s the end of his interview.

Updated at 4.26am EST

Sunak is asked about reports saying he told MPs he wants to “plug the £43bn black hole so [he] can cut taxes in a pre-election budget” and is asked if doing so would be playing politics with the recovery. Did he says that, she asks? “I don’t recognise that figure, actually,” he says.

Asked if he would like to cut taxes in a pre-election budget, he says: “I would like to be able to keep taxes low for people, I’m a Conservative and I believe in that, but I want to deliver our promises that we made to the British people that we would be responsible with their money,” he says.

It sounds like you did say this, Ridge says. “I think in the short term what we need to do is protect the economy … and over time we need to make sure our public finances are sustainable,” he replies. “If you’re asking me do I want to deliver low taxes for people, of course I do.”

Updated at 4.26am EST

Sunak refuses to speak about specific tax policy or tax rises, saying it is not appropriate to do so outside of the budget. On reports that the government is considering freezing the amount at which people start paying basic and higher rate income tax, he says again that he cannot speak about specific tax policy but adds: “This is about appreciating the damage coronavirus has done to our economy, recognising the scale of the support we have put in place, ensuring we protect the economy through the rest of the crisis, but also making sure that our public finances over time are returned to a strong position so that we can respond to the next crisis … as Conservatives I think people elect us to deliver those things.”

While he persistently declined to speak about tax policy, that answer could be read as a justification of the prospective tax band freezes Ridge referred to.

Updated at 4.27am EST

On the scale of the impact of the costs of the pandemic for the economy, Sunak says the “coronavirus has had an enormous toll on our economy and I want to level with people about that, about the problems that causes and the challenges it presents us with and be honest about our plan to address those.”

He adds: “We do have a challenge in our public finances. If we don’t do anything borrowing will continue to be at very high levels even after we’ve recovered from covid, debt will continue to rise indefinitely, and that’s not a good situation.” He says that interest rates have been at very low levels but that that can always change. “We have to be attuned to that possibility,” he says.

“Given the scale of the shock we’ve experienced, this is going to take time to fix,” he says. He does not say whether he expects to start rebalancing public finances this year.

Updated at 4.27am EST

UK chancellor sets out plans to tackle economic impact of Covid

Rishi Sunak on Sky News’s Sophy Ridge on Sunday.
Rishi Sunak on Sky News’s Sophy Ridge on Sunday. Photograph: Sky News

Rishi Sunak is on Sophy Ridge’s programme on Sky now.

Ridge begins by asking if the government’s roadmap could be accelerated if the data is better than it initially appeared. He says that the dates announced are the earliest possible, that the approach will be “cautious” and that businesses “want to know it’s a one-way road”.

He sets out planned restart grants (see earlier post). He declines to say specifically that the government furlough scheme will be extended but says that the government will “keep supporting people as we reopen the economy”.

Asked if the support packages will be wound up as restrictions are eased, he says: “I think it’s right that the support aligns with the road map … we want to make sure that our support supports people along that path and that’s what you will see on Wednesday [at the budget].”

Asked if the government will be removing the £20 increase in universal credit, he says that people should wait for the budget to see the details of the next stage of the government’s response.

Updated at 4.03am EST

The Philippines is due to receive its first batch of Covid-19 vaccine Sunday, AP reported, making it among the last countries in south-east Asia to secure the critical doses despite having the second-highest number of coronavirus infections and deaths in the hard-hit region.

President Rodrigo Duterte and top Cabinet officials will welcome the arrival of 600,000 doses of China-donated vaccine in a ceremony at an air base in the capital that will underscore their relief after weeks of delays, officials said. Vaccinations initially for health workers are scheduled to start Monday.

Aside from the donated vaccine from Sinovac Biotech Ltd., the government has separately ordered 25 million doses from the China-based company. An initial 525,600 doses of Covid-19 vaccine from AstraZeneca were also scheduled to arrive Monday, presidential spokesperson Harry Roque said.

Health workers take part in a mock Covid-19 vaccination drill at the Philippine General Hospital on 15 February
Health workers take part in a mock Covid-19 vaccination drill at the Philippine General Hospital on 15 February. Photograph: Ezra Acayan/Getty Images

The initial deliveries are a small fraction of at least 148m doses the government has been negotiating to secure. The bulk of the vaccine shipments are expected to arrive later this year.

Coronavirus has infected more than 574,000 people in the Philippines and killed at least 12,289. Lockdowns and quarantine restrictions have also set back Manila’s economy in one of the worst recessions in the region and sparked unemployment and hunger.

“Although we are still a long way from herd immunity, the arrival of the initial supply of vaccine provides hope that our road to normalcy has finally begun,” Padilla told the Associated Press.

Duterte’s administration has come under criticism for lagging behind most other Southeast Asian countries in securing the vaccines, including much smaller and poorer ones like Cambodia, Myanmar and Laos.

Updated at 3.43am EST

Rishi Sunak ahead of last year’s budget.
Rishi Sunak ahead of last year’s budget. Photograph: Peter Nicholls/Reuters
Shadow chancellor Anneliese Dodds.
Shadow chancellor Anneliese Dodds. Photograph: Stefan Rousseau/PA

We’ll be covering the Sunday morning political shows in the UK, with chancellor Rishi Sunak and shadow chancellor Anneliese Dodds appearing on both Sky’s Sophy Ridge on Sunday and the BBC’s Andrew Marr show ahead of Wednesday’s budget.

Here’s the Observer’s story overnight, which reports that Sunak will offer 700,000 shops, pubs, restaurants, hotels and other businesses grants of up to £18,000 each as part of a £5bn rescue scheme.

Planned tax rises are likely to be a major theme this morning after reports suggesting Sunak is likely to announce increases in corporation tax and capital gains tax - but Keir Starmer and Dodds have alarmed many in their party by saying they will oppose any tax rises for now.

As our political editor Heather Stewart noted this week, their stance opens up “the possibility... of a Tory chancellor proposing to tax big business to pay for the crisis – and Labour opposing it.”

Updated at 3.25am EST

Good morning from London. This is Archie Bland picking up our coronavirus live coverage, which will cover UK and global updates today, and begins in Russia, where 11,359 new coronavirus cases were reported on Sunday, bringing the national tally to 4,246,079.

The coronavirus crisis centre said that 379 more deaths of coronavirus patients had been confirmed in the past 24 hours, Reuters reported. That figure pushes the official Russian death toll to 86,122.

That’s it from me, Helen Sullivan, and over to my colleagues in London. Happy last day before March, the month when things really went belly up last year.

Jedidajah Otte

In case you missed this earlier:

More than 20 million people in the UK have received at least a first dose of coronavirus vaccine, with under 4% of those given as second doses.

Government data shows that of the 20.5m jabs given in the UK up to 26 February, 19.6m were first doses.

About 770,000 of the doses given were second jabs, an increase of nearly 33,000 on figures released the previous day.

This means just over 1.1% of the UK population have been fully vaccinated with two doses.

A total of 17.25m Covid-19 vaccinations took place in England between 8 December and 26 February, according to provisional NHS England data, a rise of just under 470,000 on the previous day’s running total:

Summary

Here are the key developments from the last few hours:

Nearly 20m have received the first dose of a Covid vaccine in the UK. More than 20 million people in the UK have received at least a first dose of coronavirus vaccine, with under 4% of those given as second doses.Government data shows that of the 20.5m jabs given in the UK up to 26 February, 19.6m were first doses. Auckland, New Zealand’s biggest city, woke up on Sunday morning to a second lockdown in a month as health authorities try to rein in a coronavirus cluster of the more contagious UK variant. The US Food and Drug Administration has authorized Johnson & Johnson’s vaccine for emergency use, making it the third vaccine available to the US public and securing another vital step in the US fight to control Covid-19. Hundreds of anti-lockdown protesters clashed with police in Dublin. Ireland’s premier has slammed the “thuggish behaviour” and attacks on Irish police as anti-lockdown protesters stormed Dublin city centre, PA Media. All English households with school children offered twice weekly tests. All households in England with school or college aged children will be offered two rapid Covid tests per person per week to support the government’s priority to get young people back in the classroom, the health ministry said on Sunday. The first AstraZeneca shipment arrived in Sydney. The first shipment of 300,000 AstraZeneca vaccine doses has landed in Sydney on Sunday, paving the way for the first major expansion of Australia’s rollout of the jab. Thailand started its Covid vaccination campaign. Thailand kicked off its Covid inoculation campaign on Sunday, with cabinet ministers, health officials and medical professionals among the first in the queue to receive vaccinations. Europe less at risk of inflation and rate fears: analysts. Investors are watching inflation carefully, worried that a boiling over of prices will ruin the expected strong pandemic recovery although analysts believe Europe faces much less of a risk than the United States.

Will Hutton

It’s time we talked about “K”. Britain, it’s now commonly agreed, will be climbing out of our economic nadir in the months ahead even if the rate of recovery is unclear – but what worries thoughtful economists, notably but not only the new US treasury secretary Janet Yellen, is its Covid-dominated K character.

Essentially winners from the pandemic – the better-off, hi-tech companies, leading brands, the healthy, those whose work held up over lockdown and live in prosperous neighbourhoods – are going to do even better, moving up the upward-sloping part of the K.

At the same time others – the disadvantaged, small- and medium-sized companies, the digitally challenged, those working in stricken sectors such as hospitality and who live in less well-off neighbourhoods, the young – are going to have it tough, sliding down the downward slope of the K. To put it at its most graphic, some will be partying while simultaneously the numbers sleeping rough and using food banks will reach epidemic proportions. On some estimates destitution is set to double:

Toby Helm

In the UK, people who have been furloughed before being made redundant, or out of work for six months, would be guaranteed training, education or work placements geared to the needs of the post-pandemic economy, under ambitious plans unveiled on Sunday by Labour.

The pledge to youngsters, whose progress in the jobs market has been blighted by Covid-19, comes as party analysis of House of Commons library figures suggests that more than one million people will become “long-term unemployed” (out of work for more than a year) during 2021 and 2022. The data also suggests that 660,000 16- to 24-year-olds will reach a point where they have spent six months out of work, education or training during the same period, at what they hoped would be the start of their working lives:

More on the reduced risk of inflation in Europe, from AFP:

The European Commission’s recovery programme is worth €750bn (US$920 bn), with several EU members also having their own national programmes.

“We have a European recovery programme... considerably less strong, and a loss of growth that is much greater, so there aren’t the same risks of overheating as in the United States,” said Fabien Tripier, an economist at CEPII, a Paris-based research centre on the world economy.

The US economy shrank 3.5% last year while the drop for the eurozone was nearly double that.

There is “no risk of overheating or a sustained rise in inflation” in the eurozone, the head of the Banque de France, Francois Villeroy de Galhau, insisted this past week.

The French Economic Observatory’s Ragot also does not believe that if the Fed is pushed by the markets into raising rates that the European Central Bank would be forced to follow suit.

“It doesn’t work like that in macroeconomics,” he said, noting that the monetary policy of the Fed and ECB had diverged considerably at the start of the last decade.

“With loose financial conditions still necessary to support the economy, the ECB is unlikely to react to the coming inflation overshoot,” said Capital Economics economist Jack Allen-Reynolds.

Francois Villeroy de Galhau, who as head of the Banque de France also sits on the ECB’s Governing Council, said the central bank wants to “maintain favourable financing conditions”.

For Fabien Tripier, the ECB needs to send “a strong signal” to the markets against the idea that “just because inflation hits 1.5% or 2.2%, speculation it will hike rates should begin.”

The ECB issued a reassuring message on Friday as executive board member Isabel Schnabel said it could broaden its support for the economy in case of a sharp rise in interest rates.

On the pandemic providing a chance to reverse the brain drain from Greece, by AFP:

The pandemic was a wakeup call that reminded Christophoros Xenos of what he misses most in London - the Greek sun and pleasant Mediterranean way of life.

The 36-year old risk manager left Greece in his early 20s for Britain, aiming to complete his studies, gain professional experience abroad and come back.

This never happened, as the decade-long Greek crisis that followed killed thousands of jobs.

But during the first coronavirus wave, Xenos took advantage of remote work to return to Greece for three months - and homesickness hit him hard.

“I worked for three months from Athens and the Greek islands and really enjoyed the weather, the quality of life, the return to the homeland,” he told AFP.

With thousands of employees like Xenos capable of working remotely, Greece sees an opportunity to bring back some of the minds the country lost during the past decade.

“We want you back,” Alex Patelis, chief economic adviser to Prime Minister Kyriakos Mitsotakis, said at a recent Delphi Forum online event.

“Open offices, set up new companies or move part of your businesses to Greece. We have the sun, the technology, and we are by your side,” he said.

Some 500,000 people moved abroad during the Greek crisis. The economy shrank by a quarter and unemployment skyrocketed to 28 percent. Since then, job figures have improved, but unemployment remains more than double the European Union and eurozone average.

The exodus of half a million people cost the Greek economy more than 15 billion euros ($18 billion), according to a report by the Hellenic Authority for Quality in Higher Education (ADIP).

Around 90 percent of those who left were college graduates and 64 percent held a postgraduate degree, according to a survey by consulting firm ICAP.

Western Australia vaccinations reach 4,000 people

About 4,000 doses of the coronavirus vaccine have been administered in Western Australia with officials hailing the first week of the program a “great result”.

Australian Associated Press: Health Minister Roger Cook said more than 2800 frontline workers had so far received the Pfizer jab with the federal government also vaccinating more than 1000 people across the aged care network.

Mr Cook said there had been no reports of any vaccine doses being wasted.

“It’s gone extremely well. We haven’t had any hitches,” he told reporters on Sunday.

The minister said another 5000 doses were expected to arrive in WA in the coming days with the government planning to extend the program to Bunbury, south of Perth, on Tuesday.

With the arrival of the first 300,000 doses of the AstraZeneca vaccine in Australia, Mr Cook said the state government was still waiting to hear from the commonwealth on the distribution process in March.

He said that was expected to include a large shipment to bolster the government’s program, but also the provision of the vaccine directly to the GP network.

His comments came after a survey of Australian Medical Association members in WA expressed concern over the state’s ability to cope with a major outbreak of COVID-19.

AMA president Andrew Miller said, the virus aside, the government needed to open more hospital beds, including an extra 100 in emergency wards.

But Mr Cook said the AMA survey came before the state’s recent COVID-19 lockdown, which showed how well its testing and contact tracing systems could operate and how hospitals were ready to act.

“Our system has demonstrated that it is battled-hardened and it is match fit and it would deal with any crisis that befell our community,” the minister said.

WA reported no new coronavirus infections on Sunday.

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