Opinion: Ian McConnell: Tory view of coronavirus aid evokes image of Oliver Twist

And, amid a surge in unemployment with much worse to come, politicians from various parties continue to appeal to Chancellor Rishi Sunak not to end the coronavirus job retention scheme, which has supported the incomes of millions of furloughed workers and enabled them to remain employed.

By and large, the pleas for extra support make perfect sense.

Those who oppose further support argue that too much money has been spent already, and that we cannot go on providing billions upon billions of pounds of assistance.

These people, whether members of the public or of Boris Johnson’s Cabinet, seem to demonstrate some tiresome and lamentable Tory traits that have proved detrimental in the recent past.

The first is an obsession with cost, rather than looking at the whole picture and particularly the likely counterfactual scenario had the support not been provided. For example, the furlough scheme preserves incomes and supports consumer confidence, thereby boosting aggregate demand. It will ultimately save money on unemployment benefits that will not need to be paid for months or years if staff can be retained until such times as their employers can reopen or operate at something close to full capacity. The furlough scheme will also deliver valuable benefits in terms of reducing the longer-term costs of health and social care if far fewer people have to face the grim and dismal effects of unemployment.

Another Tory trait evident in the lack of willingness to provide continuing support is impatience. It is always crucial to look at the bigger picture and apply reason, and thus avoid rushing into the same type of rash decisions we have seen in the past because of ideology.

Remember the rush by former prime minister David Cameron and his chancellor, George Osborne, to implement a savage austerity programme in the summer of 2010? This sucked the life out of an economy which had been limping its way back to health because this pair favoured huge cuts in benefits for the working poor and unemployed.

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This austerity programme, which essentially continued after Mr Cameron’s departure, has subtracted directly and dramatically from aggregate demand, and has weighed so heavily on the economy since 2010. The Liberal Democrats, back in 2010, were persuaded of the “need” for a swift austerity programme, even though their election campaign of that year had prescribed pretty much the opposite. Their initial prescription was much more like what was required, as opposed to the bitter-tasting and crucially massively counter-productive medicine ultimately administered by the Conservative-Liberal Democrat coalition.

The Tories have the benefit of hindsight at the current juncture but it seems they will revert to instinct, given recent pronouncements from the Government.

It becomes increasingly frustrating to hear those arguing against further support babble on about how people who advocate such help are just being irresponsible and somehow naïve and just want to rack up the national debt. Someone will have to pay for all this, those in favour of withdrawing support declare condescendingly. Such a view just seems like the latest vintage of typical Tory philosophy which at times embodies a frightening lack of empathy and in any case has singularly failed to deliver on the economic front for so long now.

And how about this? The Conservatives propelled the UK’s public sector net debt from £1 trillion in 2010 to £1.8 trillion, just ahead of the coronavirus pandemic hitting.

Figures last week showed it had surged through the £2 trillion mark. The coronavirus crisis and support put in place to try to fend off an economic depression have played a key part in the jump in recent months, but what about the approximately £800 billion of extra debt racked up by the Tories in the near-decade to the start of 2020? That reflects in large part failed economic policies, notably austerity.

What is crucial right now as people talk about debt and future generations is that the benefits, and not just the cost, of the Government support must be examined. After all, preserving employment and enabling consumer confidence and spending will boost tax revenues from individuals and businesses. It will also, to emphasise an aforementioned point, mean that the UK does not face the costs of unnecessary unemployment, in terms of benefits and an increased burden on health and social services, which would otherwise be incurred if a different path were followed.

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Right now, this is very much about confidence, and not losing nerve, and creating virtuous rather than vicious cycles.

Of course, Mr Sunak’s Eat Out to Help Out scheme appears to have been a lot about boosting confidence. It has endeavoured to get people out and about to support the hospitality sector, which is a huge employer. There has been much debate over the merits or otherwise of this scheme, which does certainly appear to have grabbed people’s attention and resulted in brisk trade for restaurants in the early part of the week, while also generating footfall in retail areas.

However, the bigger question is around the timing of the scheme, which is drawing to a close.

It is understandable, in terms of a stitch-in-time-saves-nine philosophy, why the assistance was put in place to support restaurants in the period immediately after they reopened, enabling them to bring back furloughed staff and so forth.

However, it could also be argued that, with some demand coming from a staycation summer amid a highly fluid position with the UK’s air bridges, there will be times ahead when the support could have been more beneficial.

What about November and January, which can be very tough times for the hospitality sector? It also remains to be seen how the normally busy month of December turns out. It is easy to see plenty of challenges, given likely economic misery for millions and crucially uncertainty over how the coronavirus situation will develop over the winter.

We will, of course, also have the UK’s exit from the European single market on December 31 and all the woe that causes.

It looks like it is going to be a very tough winter indeed as the grim economic effects become ever more apparent for households and businesses. A further dramatic rise in unemployment is projected, albeit the Conservatives still have it in their power to mitigate this like the Germans are doing simply by extending support over the period the coronavirus pandemic is likely to continue to have a major impact on the economy. And UK company failures are projected to spike.

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Local lockdowns seem likely to continue as well, and we must not lose sight of the continuing absolute priority to ensure everything possible is done to save lives amid this awful pandemic.

Everything points to a continuing need for the furlough scheme. This must continue beyond October. Its cost will reduce dramatically naturally as workers are taken back on or, sadly, as some companies embark on cost-cutting drives or fail. The preservation of jobs must absolutely be prioritised.

And further sector-specific support will be required.

Workers affected by having to self-isolate or by local lockdowns should also have their incomes supported, rather than being given paltry payments. This is not only the right thing to do but crucial from the perspective of public health.

The Conservatives have at times almost given the impression they are spending their own money, rather than that of the UK taxpayer.

But we are not in the Victorian age, and individuals and businesses should not be left to feel like poor old Oliver Twist. Like Oliver, many have found themselves in difficulty through no fault of their own.

What is coming must not be underestimated. And every opportunity should be taken to mitigate it.

IPPR Scotland this week warned that, on its central scenario, more than one in three 16 to 24-year-olds north of the Border, more than 100,000 in total, are likely to be unemployed later this year “as the furlough schemes end and the UK as a whole enters a jobs crisis”. This would represent record youth unemployment. And the think tank warned that youth unemployment could be worse than this in a “reasonable worst-case downside scenario”, with more than 140,000 young people out of work by the end of 2020.

It is also calling on the UK Government to “maintain support for jobs across the economy by replacing the furlough scheme with a ‘short-time work scheme’, as seen in France and Germany, that would see employers able to offer subsidised part-time work rather than being forced into laying people off”. The German scheme pays the majority of employees’ lost incomes when working hours are reduced, and offers such support even where these have to be cut to zero.

Of course providing help to all of those who find themselves in dire straits amid the coronavirus crisis is morally the right thing to do, and it is very disappointing indeed to see a lack of recognition of this among some people.

However, providing such help is also likely to be the optimal course of action for the health of the economy and, ultimately, in terms of the public finances, when everything and not just the cost line is taken into account. It is time for those who would argue that the rug should be pulled from under people to look at the big picture. And look at it right now. And put aside the ideology. And do the maths.