Yahoo Finance UK government spending £6,700 per household on COVID support
Britain's government has spent £6,700 ($9,300) on COVID-19 support for every household in the country, according to new Resolution Foundation research.
The study shows that typical household incomes "have remained flat during the past year and firm insolvencies have actually fallen, despite the economy experiencing its biggest contraction in over 300 years."
In the last 12 months, of the £340bn of emergency COVID support chancellor Rishi Sunak poured into the UK economy — £186bn has directly supported households and companies via the furlough scheme, benefits uplift and grants for firms and the self-employed.
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The report examines the government's response to the coronavirus pandemic, vaccines and support to protect firms and workers.
While everyone has been affected by the pandemic, the research shows that its impact has not been felt evenly, with poorer households bearing the brunt of the health and economic crises.
"The COVID-19 pandemic has touched everyone, but lower-income families have borne the brunt of the crisis in terms of their lives and livelihoods. This shouldn’t be forgotten as we look to rebuild post-pandemic Britain," Brewer said.
Resolution Foundation notes that recent mortality rates in the most deprived parts of England have been nearly twice that in the least deprived regions.
It shows that while "aggregate savings have surged" during the pandemic as restrictions have prevented higher income households from spending, the poorest fifth of households are 50% more likely to have seen their savings deteriorate rather than rise during the crisis.
The report adds that the poorest fifth of households are also twice as likely to have seen an increases in their debts amid COVID-19. In contrast, the richest fifth of households are twice as likely to have seen their debts fall rather than rise.
These changes to saving and debt levels mean that COVID’s "economic legacy will be bigger gaps between rich and poor" that last even as the recovery gets underway, the Foundation said.
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The report said that the government's "repeated failure" to lockdown "in time" contributed to the "worsening economic outcomes" and left England with higher death rates. It calculated that the delay in the latest lockdown until January is estimated to have led to around an extra 25,000 Covid-related deaths
"As we approach the first anniversary of the UK’s first lockdown, it’s important to take stock of where the Government has delivered and where it has failed" amid the crisis, Mike Brewer, chief economist at the Resolution Foundation, said.
Brewer added: "Its record on delivering jabs to people’s arms and cash to people’s pockets has been hugely impressive. On both, the strategy of going big, bold and early has clearly paid off.
"In contrast, going timidly and late on lockdowns has been a disaster – causing many thousands of avoidable deaths. Furthermore, delays to restrictions have meant them needing to be tougher and longer-lasting than in other countries, thereby worsening the economic damage."
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