The UK is poised for ‘a challenging period’ due to the new coronavirus, Chancellor Rishi Sunak said today.
Ahead of his Budget on Wednesday, he said the government was ready to help both the NHS and businesses deal with the epidemic.
Mr Sunak said: ‘We stand ready to give the NHS whatever it needs. We’ve already deployed funds to the NHS both for vaccine development and immediate response.
‘We’re able to do that because of responsible management of public finances over the past several years that I can say yes, I can take whatever steps are necessary to help us get through this, because of those decisions we made in the past. The economy is in a good place and we will get through this.’
Speaking to Sky’s Sophy Ridge on Sunday, he said businesses would also be able to access financial support to get them through the outbreak, with the projecting that up to one in five people could be off work sick at one time.
Mr Sunak said: ‘This could be a challenging period for businesses. If 20% of your workforce are not able to come to work that is going to have an impact. But it will be an impact for a temporary period of time.
‘What do we need to do to ease the burden on business over that temporary period of time to make sure that they have access to the cash flow they need, to bridge through a difficult period so that they can emerge on the other side strong and ready to get back to normal.
‘Bail-out is not necessarily the right word but there are policy levers we can take to ease the short-term burden on business’s cash flow. These are businesses we think are viable, sustainable, that have a bright future but that are going to have a temporary period of disruption, and that’s where our intervention is going to be focused. ‘
Mr Sunak, who has been in office for less than a month, said he was ‘not daunted’ by the challenge of protecting the UK’s finances in the event of a major Covid-19 outbreak.
Instead, he told the Sunday Telegraph, the country is ‘well prepared’ and would ’emerge on the other side stronger’.
Outlining his plan to help businesses cope with the virus, the MP for Richmond (Yorkshire) said: ‘You have to look at the nature of what the economic impact might be, so that we can design an appropriate response.
‘The main issue is lots of people might be ill, and therefore not be able to be at work. And that impacts the productive capacity of your economy if you’ve got a manufacturing plant and they can’t make their widgets.’
He added: ‘We need to look at what are the interventions that we need to help bridge a difficult period. That’s where we might look at some targeted options to help ease the strain on cash flows for a certain period to help them get through to the other side.
‘Obviously, alongside the supply shock there will likely be an impact on demand if people are at home.’