8. Weekly Newsletter
Vaccine Roll-out and Lockdown End Date
Total confirmed COVID cases stand at over 4,126,100 and around 120,000 have now died. However, daily figures are almost halving each fortnight with just 9,834 confirmed cases yesterday which marks a sharp decline from the peaks of almost 70,000 during January. Also, the number of people in the UK to have received a vaccination so far currently stands at over 17.6m and represents a third of the adult population. PM Johnson has additionally outlined his latest vaccine target of inoculating the entire UK adult population by the end of July.
On Monday, the 22nd, the Government unveiled it’s ‘Roadmap’ to permanently ending lockdowns in a step by step basis. This major announcement has been anxiously waited upon for much of the month and comes following the latest confirmatory revelations surrounding the high efficacy rate after just the first vaccination (of two). PM Johnson’s plan would see almost all restrictions lifted by the 21st of June– just two weeks before the UEFA Euros Final at Wembley Stadium. All guidance for the lockdown exit roadmap can be found here.
UK Government Borrowing
January is typically the major revenue-raising month for the UK with a surplus of £9.6bn over the 31 days in 2020. However, this January the UK experienced its first deficit during the month in a decade as the deficit hit £8.8bn. Despite the poor performance in the economy: tax income fell by less than £1bn but borrowing had risen an extra £19.7bn for the same period. Overall debt has now reached 97.6% of GDP (the highest level since the 1960s) and the OBR has estimated that borrowing for the financial year (concluding in March) could total £394bn.
The Chancellor, Sunak, will publish the Budget statement on Wednesday 3rd March and one of his two main focuses will be tackling the rise in debt which has been built up over the pandemic. His other priority is expected to be on how to provide support to those hardest hit by the economic fallout. Sunak’s party won the 2019 General Election with the manifesto pledge not to raise income tax, National Insurance or VAT but, due to the pandemic, this may no longer be possible. Some analysts have predicted potential rises in the Capital Gains Tax and environmental taxes (such as a landfill tax and higher fuel duties).
British Retail
A sharp 8.2% decline in retail sales volumes for the month of January was recorded, when compared to December 2020, as strict nationwide restrictions hampered performance. This fall was not as significant as the 22.2% plunge witnessed during the first national lockdown in April 2020 due to the now record 35.2% of purchases being made over the internet. Online sales for food have now reached an historic high of 12.2% in the industry with the online-only food retailer, Ocado, seeing their share price more than double over 12 months. At the start of the pandemic: Ocado underwent such an increase in demand that they were forced to temporarily ban new customers from joining them.
The Retail Sector Council has also concluded that “there will be fewer jobs in retail in the future” as 850 retail jobs are being currently lost each day. Furthermore, the industry still has around 700,000 workers on the Government’s Furlough Scheme– which has now been extended into the summer. The loss of employment from traditional ‘brick and mortar’ retailers has been in-part replaced by new jobs created to support the rise in online demand. Tesco, for instance, has made 16,000 temporary jobs permanent due to the uplift in demand which has helped sustain UK unemployment rates at around 5%.
