Watchdog slams government for lack of pandemic economic plan
Parliament’s financial watchdog has slammed the government for its failure to plan for the economic consequences of a pandemic, saying it was “astonished” that the UK was not better prepared.
The House of Commons Public Accounts Committee (PAC) said the Treasury waited until mid-March to design schemes to support the economy. That was despite it having planned extensively for the health problems posed by a flu-like pandemic.
PAC said the lack of planning created “initial uncertainty for many businesses and individuals”.
Committee chair and Labour MP Meg Hillier said the government had made policy “on the hoof”.
“Pandemic planning is the bread and butter of government risk planning, but we learn it was treated solely as a health issue, with no planning for the economic impacts,” she said.
“This meant that the economic strategy was of necessity rushed and reactive, initially a one-size fits all response that’s leaving people – and whole sectors of the economy – behind.
‘Astounding’ failure to alert business department
The report said the government had “mobilised a wide-ranging response” to the pandemic, pumping £120bn into the economy to support the health service, companies and the public.
“We give the UK Government credit for moving fast to deliver this,” the report said.
But it added: “We are astonished by the government’s failure to consider in advance how it might deal with the economic impacts of a pandemic.”
The report highlighted the government’s 2016 pandemic simulation exercise, called Operation Cygnus. Almost 1,000 officials took part, extensively modelling the health impacts of a major disease outbreak.
Yet the operation did not think about the potential impact on the economy and the Department for Business was not even aware of the exercise. The Committee said this oversight was “astounding”.
In particular, PAC flagged the possible impact of the lack of planning on schools. “There seems to have been no plan or support for how schools and pupils would be supported to continue to learn,” it said.
The report also criticised the government’s handling of personal protective equipment (PPE). it said there were “fundamental flaws” in “procurement and local distribution” of equipment.
“Despite a pandemic being identified as the government’s top non-malicious risk, it failed to stock up in advance.”
Committee recommends governmental review
PAC recommended that the Cabinet Office review its contingency planning to consider “whole-of-government impacts, including economic modelling”. It said it was concerned that not enough had been done to prepare for a second wave of coronavirus cases.
A government spokesperson said: “As the public would expect, we regularly test our pandemic plans – allowing us to rapidly respond to this unprecedented crisis and protect the NHS.
“It was clear that Coronavirus would affect all areas of the country, that’s why we immediately put in place an unprecedented initial economic support package for jobs and business worth £160bn. The next stage in our economic response will make a further £30bn available to ensure all areas of the UK bounce back.
“We’re providing over £100m to support children to learn at home and a £1bn Covid catch up fund will directly tackle the impact of lost teaching time, as schools and colleges welcome children back in September. In addition, we’ve committed almost £28bn to local areas to support councils, businesses and communities.
“Over £3bn of additional winter funding will be available immediately to the NHS to prepare for the risk of a second peak and we continue to work around the clock to ensure PPE is delivered as quickly as possible to those on the frontline.”