Sunak: Covid schemes could stave off damage from Brexit turbulence
The Chancellor Rishi Sunak has said that Coronavirus support schemes could provide insurance against the economic impact of Brexit.
“For businesses that need liquidity to get through a temporary time, we’ve got very generous… loan programmes for anyone who is having trouble with costs and employment,” he told The Spectator in a wide-ranging interview.
It is the first time the Chancellor has hinted that schemes such as the furlough programme, which is continuing until March, are envisioned as providing a safety net against any unforeseen turbulence from Brexit.
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The Chancellor, who has been in his job for less than a year, also warned that “it is clearly not sustainable” for the UK to borrow at current levels.
The UK is set to borrow £394bn this year, more than £300bn more than the Office for Budget Responsibility had forecast in March.
“I don’t think morally, economically or politically it would be right,” he said.
“Running a structural deficit years into the future, with debt rising? That’s not building up the resilience you need to deal with the future shock that will come along.”
Taking on critics and economists who predict low interest rates for years to come, the Chancellor warned that between large-scale quantative easing and the UK’s unprecedented debt pile it would be irresponsible to assume interest rates will remain low.
Sunak also appeared to rule out a wealth tax in the interview, saying that the Conservatives should be a party which “celebrates aspiration.”