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Economy / Jobs

Morning briefing: UK must “wean off” government grants

Good morning.

Ministers’ plans to wind down the grant scheme for furloughed workers are taking shape: the Treasury is considering lowering the 80 per cent wage subsidy to 60 per cent, reducing the maximum payment one person can receive from £2,500 a month, or allowing furloughed staff to work part-time with a smaller subsidy. “We’ve got to wean off it,” Health Secretary Matt Hancock said last night. The scheme will run in its current form until 30 June. Prime Minister Boris Johnson is set to provide more detail on the plans on Sunday, giving larger businesses enough time to, if necessary, hold a statutory 45-day consultation before making redundancies at the beginning of July. The Times also reports that ministers might bar self-employed workers with profits of more than £30,000 from claiming government grants – currently, the bar is £50,000.

Scientists from Edinburgh University have proposed that Britain could leave lockdown by easing restrictions on more than half the population while strengthening protection for vulnerable groups. The “segmenting and shielding” plan, which suggests the elderly and vulnerable only see carers and family members, is under consideration by ministers.

Meanwhile, the Resolution Foundation think tank has warned that UK youth unemployment could top 1 million within a year unless ministers offer job guarantees or incentives for graduates and school leavers to continue their education. A lack of jobs for the “corona class of 2020” could see the number of unemployed people under 25 balloon by 600,000, it said.

Finally, as we reported on this blog last night, the scientist whose modelling led to the UK’s lockdown, Professor Neil Ferguson, has resigned from his position within the government’s scientific advisory group (Sage), after a Daily Telegraph investigation found he had at least twice been visited at his home by a woman with whom he was in a romantic relationship, and who lived elsewhere.

Global updates:

South Korea: The country has moved out of lockdown into an “everyday quarantine”, where people are asked to follow a detailed set of non-binding guidelines for every aspect of their lives, including eating in restaurants and taking public transport.

US: The White House has confirmed it will wind down its coronavirus task force, despite the fact more than 1,000 people are dying from the virus every day across the country. Meanwhile, President Donald Trump said the economy must reopen soon, even if some people were “affected badly”.

Brazil: Brazil recorded 600 deaths in a 24-hour period, far higher than its previous recorded (474), as São Luís became the first major city in the country to enter lockdown.

Germany: The heads of German states can decide when to reopen universities, restaurants, bars, hotels and other businesses, and how to limit contact between people, according to a draft government agreement. Chancellor Angela Merkel will meet with leaders from 16 states today to finalise the plans, which will see lockdown measures reintroduced if the number of new infections reaches more than 50 per 100,000 inhabitants over a seven-day period.

Italy: Italy’s latest daily tally of new infections stood at 1,075, the lowest in two months.

Spain: More than 70 per cent of new infections in Spain are among medical staff, the health ministry has said.

China: Schools in Wuhan reopened for the first time since the start of the pandemic, and Disneyland announced its Shanghai park will reopen on 11 May under “enhanced health and safety measures”.


Read more on the New Statesman:

How the UK overtook Italy to become the country with the highest Covid-19 death toll in Europe

Why the UK’s lockdown rules are too vague and risky

What does Neil Ferguson’s resignation mean?

The economy needs real reform to recover from Covid-19
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