How will your life be different After Coronavirus? (March 31)

Paul Johnson is director of the Institute for Fiscal Studies: Even if the economy is released from lockdown by the summer, the policy priorities and choices facing government will be utterly different from those of what seems like a lifetime ago when it assumed office in December.

First, how to respond to the elevated debt and deficit. If we’re lucky, the economy will recover much more quickly than it did after 2010 and, after a huge spike, the deficit will fall rapidly — although that is by no means guaranteed. Accumulated debt will be higher. More austerity on the spending side is surely implausible. That suggests living with yet further elevated debt for many years, or tax rises, or both.

So, second is what to do with the tax system. The government has protected businesses and incomes. There will be a reckoning. Successful businesses and individuals can surely expect to end up repaying some of the costs of the present support through higher taxes on profits and incomes.

Third, we might well have to deal with a surge in inflation. My guess is that higher inflation will be accommodated for a while. Savers beware.

Fourth, when to withdraw support for jobs and businesses? The political pressure will be all for keeping support going as long as possible, probably longer than is economically optimal.

Fifth, what about the younger generation, those who have had their educations interrupted or their opportunities in the job market blighted? We surely can’t impose yet more burdens on younger generations and fail to act to support them while forever protecting the old?

Sixth, over the past decade the welfare system has become less generous while minimum wages have been raised sharply. The national living wage has gone up by 15 per cent over the past five years and is due to rise by another 51p an hour from Wednesday this week. It’s hard to believe that it remains the right decision, given how many companies are struggling for survival.

It is an illustration of the political difficulty of doing anything that smacks of being ungenerous that this is one nettle the chancellor has chosen not to grasp. He will need to take a dispassionate look at commitments to continue raising the minimum wage once we know more about the future state of the labour market.

He also may find recent increases in the generosity of universal credit and housing benefits hard to unwind. Returning to the status quo ante next year will immediately reduce benefit payments by £1,000 a year and more from what universal credit recipients will have become used to. That will be a tough policy to sell. Returning the housing benefit system to one based on local rents as they were in 2012 (which believe it or not is what we had until now) would surely be bizarre.

And that’s just the first half-dozen issues that spring to mind. The facts have changed. We will need to be equal to the task of adapting to new realities. The Times 30 Mar

Philip Inman, Guardian: Thinking about what a nation should spend when its income falls off a cliff, and how much it will owe as a consequence, is especially mind-boggling for conservative policymakers emerging from 10 years of austerity. Many have spent their entire careers telling voters that paying back what the country has borrowed is of paramount importance.

All money, in the age beyond gold coins, is real if the authorities say it is and the authorities are trusted. It could be printed on paper – or just sit in an accountant’s ledger – and still add up to money.

Is this real money that will eventually need to be paid back? Or can it somehow be left behind by one generation to be written off by the next?
The Bank of England, which can already count £435bn of outstanding loans to the UK government under the QE programme, is preparing to expand that total by £200bn. This monetary stimulus is equal to just under 10% of the UK’s national income, or at least the income the UK registered in 2019.

Much of this money is going to be spent by Rishi Sunak on various rescue measures. At the moment he looks like spending 7.5% of GDP on coping mechanisms, but the severity of the downturn could quickly eat up all the Bank of England funds.

Is it real money that will eventually need to be paid back? Or can it somehow be left behind by one generation to be written off by the next?

The messages from British government are confusing. On one hand, ministers say taxes will need to rise once the crisis is over. Further, self-employed people, usually lauded as the lifeblood of an entrepreneurial economy, will need to pay the same as those on PAYE – almost as an extra punishment for needing the same coronavirus bailout as their employed cousins.

This suggests that austerity will be back with a vengeance, just in a different guise to 2008. There will be fewer cuts to public services and much more emphasis on households diverting a higher share of income to the state.

It’s not a very Tory answer to a debt crisis – but, more than that, if the extra taxes are applied to incomes, it will only rob households of their spending power and further dampen growth.

An alternative to the gloom of neverending coronavirus repayments is modern monetary theory, resisted for years on both sides of the Atlantic, which has arrived like a Nightingale nurse armed with a bag of stimulants. The theory – and now practice – says that a central bank can print enough money to cover the interest on government debt for as long as it likes.

Willem Buiter, the Columbia University academic who was a founding member of the Bank of England’s monetary policy committee before becoming chief economist at Citigroup, says the US and UK now have money on tap in almost limitless amounts. The funds can sit on a central bank’s balance sheet for as long as it takes.

Critics of MMT argue it can prove to be too much and overheat an economy. At that point taxes would need to be increased – something that until now few believed western governments were capable of doing.

But in a post-pandemic world, inflation is unlikely to feature, and if it does, the central bank can just rein in its lending, as and when it deems necessary to keep inflation low. Guardian 28 Mar

Shops on struggling high streets and shopping centres may never reopen as retailers are forced into a more rapid retreat by coronavirus, one of Britain’s biggest landlords has warned.

Chris Grigg, the chief executive of British Land, the FTSE 100 giant behind a £4.8bn retail portfolio stretching from Sheffield to Plymouth, said the outbreak would act as a “stress test” for retailers facing lengthy closures.

“What you will see is that in less good places, retail won’t reopen. People are just going to say, ‘I’m sorry but we’re going because we now know what physical [stores] does for us and what it doesn’t’.”

Mr Grigg’s comments follow forecasts from the Centre for Retail Research that more than 20,000 shops could close this year as Covid-19 accelerates the rise of online shopping. Some 235,000 jobs could be lost.

He added larger “super-regional” shopping centres, such as Westfield’s Stratford City and Westfield London sites could also come under pressure in a fast-changing retail climate because they are “just too big”.

“There aren’t enough retailers, they have got too much space and you can’t really easily transform that,” he added.

While offices form the majority of British Land’s £11.7bn portfolio, barely one 1 in 10 of its stores are open due to the lockdown. Daily Telegraph 29 Mar

Peter Foster, Europe Editor, Daily Telegraph: Where does coronavirus leave Brexit? Well, on a practical level, the negotiation is in a state of limbo – mothballed until both sides have the bandwidth to resume, whenever that might be.

In short, the process is in stasis and no-one really knows – simply because no-one at this point can predict how deeply coronavirus will impact us all – what it will look like on the other side.

In the short term, my firm betting (ignore the current official line from Number 10) is that the UK will have no choice but to seek an extension to the negotiating period before July 1, although I understand there is no official discussion of this on both sides.

There will need to be a money negotiation in order to continue the ‘status quo’ transition and while the Withdrawal Agreement gives the EU a free hand on this, in these circumstances I’d bet there was political will to agree a figure in a very neutral and technical way.

Politically, extending Brexit talks will represent a ‘breach of contract’ for some of Boris Johnson’s backbenchers, but he will not be alone in invoking a ‘force majeure’ clause as a result of coronavirus.

It is a pity that politics means that this inevitability has to be delayed until its necessity becomes self-evident.

When the moment comes to re-engage, my personal hope is that the government looks to negotiate a more thoughtful and less ideological Brexit than the one it was shaping up to deliver at the end of this year.

Whether it is finding a way to remain properly linked to the EU’s pandemic early warning system (EWRS); seeking associate membership of the EU’s aviation safety agency (EASA) or heeding the warning of the transport and logistics industry on the fragility of supply chains, the coronavirus episode gives everyone pause for thought.

A more measured approach will, I suspect, partly be a question of necessity, since industry, business and the services will be in no position to absorb the kind of disruption and dislocations that the government was planning to inflict upon them.

It is sobering to see that the supermarket supply chains have manifestly been unable to adjust for the demand.

The current government has been in the habit of waving away the objections of industry on these subjects, but coronavirus has highlighted the vulnerabilities of the UK’s services-dependent economy which imports a lot of its food from Europe and whose advanced industry relies on intermediate inputs from pan-EU supply chains.

The disproportionate battering of Sterling on the currency markets has equally highlighted the perils of being a small ship on a stormy sea; with finance experts noting that the Pound is taking the kind of hit you’d expect from smaller currencies, like the Australian and Canadian dollars.

Perhaps it is too much to think that when the Covid-19 crisis clears (and in a worst case scenario, with the epidemic coming in two or three ‘waves’ that might be 18 months away) the broader politics of the Brexit negotiation will be less adversarial – on both sides.

Of course, it is not impossible the needle swings the other way. Coronavirus may give birth to a new nationalist-sovereigntist narrative in Europe – it is too early to say who will emerge as political beneficiaries of the outbreak, Macron or Le Pen? Conte or Salvini? – but I still bet the economic fallout will practically limit options. Daily Telegraph 30 Mar

Large organisations have installed software on employers’ laptops that take photos of their screen at intervals throughout the day and monitor how much time they spend browsing the internet, and which websites – and this could have increased during the lockdown.

Edgar Ndjatou, director at Workplace Fairness said: “It is always important to remember that when you are given a device by your employer, always assume they are either tracking the location or software you are using or will at some point do an audit of the devices to see what you have been up to, and that it is all legal.”

Employers are entitled to monitor workers for various reasons including unsafe working practices or regulatory reasons, but “workers are entitled to privacy at work” and therefore should be telling their staff if they are being tracked, Tom Neil, senior advisor at Acas, the government-backed Advisory, Conciliation and Arbitration Service said.

“Given the current situation with millions of people now working from home, many people may be using work devices for personal use, to access emails, or the internet,” he added.

Time Doctor, a software company that boasts 83,000 companies as customers, silently records apps and internet usage, takes pictures of the screen and sends them to managers and users with weekly reports.

Liam Mclvor Martin, Time Doctor chief executive, denied that the software, which takes pictures of a worker’s screen was simply used for snooping on workers and described it as a “Fitbit for productivity”.

Time Doctor has seen more demand in the last week than it had in the last three months, he said. Mr Martin claims that KPMG and PWC were among its 83,000 users, and both companies are listed on its website.

When approached for comment KPMG said it had no current record of its use. PWC said that it did not use the tool in the UK.

Another popular tool is CurrentWare, which monitors energy consumption along with internet history and time spent on Microsoft Excel or Word and any work related programs.

It lists Nestle, Raytheon, HP and hotel chain Hyatt as customers on its website. HP denied using the tool.

London-headquartered Sneek found itself the victim of a social media campaign when it emerged that it made software that takes photos of employees through their laptop webcam every five minutes and share those pictures with their team.

Philip Landau, employment lawyer, said: “It may be easy to forget whilst working from home for unprecedented periods of time that your employer is still monitoring your activity by your workplace systems.

“While there may be a relaxation of such monitoring in the present unique circumstances, it would be wrong to think that no surveillance is taking place at all.

“Indeed, such monitoring could even be greater than before the lockdown. You can still face disciplinary action if it is found that you are in breach of your employer’s policies due to unreasonable personal use of your work computer” Daily Telegraph 30 Mar