Economic impact of coronavirus: gaps in support and economic analysis Contents


This is the third report of our inquiry into the economic impact of coronavirus. The first report focused on those who had fallen through gaps in support and asked the Government to mitigate those gaps. The second report focused on the medium-term challenges facing the UK economy, such as combating long-term unemployment and dealing with high levels of corporate debt.

Gaps in Support

Since we last reported on the economic impact of coronavirus, the Government has extended both the Coronavirus Job Retention Scheme (CJRS) and the Self-Employment Income Support Scheme (SEISS) to the end of April 2021. We believe that the Government was right to do so.

The first version of the SEISS scheme had to be rolled out at speed in the spring of 2020. Partly because of that haste, there were ‘hard edges’ which meant that some people lost out. Though regrettable this is understandable. However, there is little justification for not having addressed them eleven months later.

We recognise that it may not have been possible for the Government to help all those who have fallen through the cracks of the support schemes. However, we are disappointed that the Government has so far shown no inclination to expand or provide alternatives to the SEISS, which is providing a vital life-line to many but is not available to all those whom we believe should qualify. We recommend that the Government look at other models of support, including those developed by the devolved administrations with a view to extending support to people who require support and who do not currently qualify.

We make the following detailed recommendations for extending eligibility:

Economic Analysis

While death rates from coronavirus are high, the rationale for Government decisions on social restrictions is well understood by the public. As the vaccine roll-out proceeds and death rates fall, Government decisions on whether or not to lift restrictions will become more finely balanced. We believe that economic analysis and modelling is essential to inform those decisions alongside evidence of the other necessary infrastructure such as test, trace and isolate, and responses to new variants, being comprehensive and in place to mitigate against the need for a further lockdown. We make the following recommendations:

GDP as a measure of the impact of the coronavirus: international comparisons

We note that comparisons with other countries’ Gross Domestic Product (GDP) may be affected by differing measurement methodologies at this time. We therefore caution against over-reliance on the UK’s GDP performance in comparison to other countries, as a measure of the impact of coronavirus on the economy. We recommend that the Treasury and the Office for Budget Responsibility provide a commentary at the time of the Budget on GDP measurement issues and the implications that these measurement issues have for comparisons between the UK and other countries.

Published: 15 February 2021 Site information    Accessibility statement