Chancellor Rishi Sunak has said it is “now very likely the UK economy faces a significant recession”, following the release of new data showing that GDP shrunk by 2 per cent in the first quarter of the year.
The Telegraph reported that officials believe the UK economy is unlikely to follow a so-called “V-shaped” recovery, where it bounces back quickly after the pandemic, and Sunak did not deny the report.
“I think it’s premature to speculate,” he told the BBC. “But what we do know is in order to make sure that recovery is as swift and as strong as we will like it to be we need to take action now to protect jobs.”
Yesterday, Sunak extended the government’s furlough scheme by longer than expected, adding to the cost of the pandemic. New Statesman political editor Stephen Bush wrote this morning about why Sunak is right to prioritise growth over paying down the debt. Read his analysis here.