Boris Johnson has said that now is the time to be “ambitious” about the future of the UK, by establishing a post-coronavirus recovery plan.
The Prime Minister promised to “use this moment” to solve longstanding economic problems and promised a £ 5bn “new deal” to build housing and infrastructure.
The plans set out in the Tory electoral manifesto would be accelerated and “intensified,” he added.
Labor and the CBI said they were not focusing enough on saving jobs.
Labor leader Sir Keir Starmer said “there was not much deal and there is not much new.”
It came when new figures showed that the UK economy contracted faster than at any other time since 1979 between January and March.
In a broad speech at Dudley in the West Midlands, Johnson promised to “build, build, build” to soften the economic impact of the coronavirus.
He said the government wanted to continue its plans to “level up,” one of its main slogans from last December’s elections, since “too many parts” of the country had been “left behind, neglected, unloved.”
Infrastructure projects in England would be “accelerated” and there would be investment in new academy schools, green buses and new broadband, the prime minister added.
Projects in the £ 5 billion investment plan include:
- £ 1.5 billion for hospital upkeep, eradicating mental health dormitories, enabling hospital construction and improving A&E capacity. The government said this is “new” money in addition to the £ 1.1bn it announced in its spring budget.
- £ 100 million for 29 road network projects including bridge repairs in Sandwell and improvement of the A15 in the Humber region – this money has already been announced
- More than £ 1 billion to finance a school building project, as announced Monday: This cash comes from the government’s existing infrastructure plan.
- A £ 12 billion affordable housing program to build 180,000 new affordable homes for rent and property in the next eight years: The program brings together three pots of money already announced by the previous Conservative governments and the Johnson administration
The Prime Minister loves a great historical comparison.
He is an enthusiastic student of Winston Churchill, and has even written a book about him.
In recent days, the comparisons the government has attempted to make have been with former US President Franklin Delano Roosevelt and his “New Deal.”
As my Reality Check colleagues point out, the plan set today is a tiddler compared to what FDR did, and a good part of this is to re-announce what we already knew the government was planning.
But Boris Johnson is trying to expose the government’s vision in a broader context, and his pride in saying that he wants to spend a lot to revitalize the economy and get it out of the crisis.
Under what he called “project speed,” planning laws would also be streamlined to encourage construction.
The changes, planned for September, include:
- A wider range of commercial buildings will be allowed to switch to residential use without the need for a planning application
- Builders will not need a normal planning application to demolish and rebuild empty and redundant residential and commercial buildings, if rebuilt as homes.
- Homeowners will be able to build additional space on their properties “through a quick approval process” and subject to consultation with the neighbor.
The village pubs, libraries and shops will be protected from the changes, as they were “essential to the life of the communities,” the government said.
Johnson acknowledged that changes in planning could meet resistance in traditional Tory voting areas, but said: “Sometimes you have to get on with things.”
The prime minister gave an idea of what the post-government shutdown strategy might look like today, but there was nothing really new here.
The Treasury will accelerate the capital investment that has already been announced and will tolerate higher debt levels.
But they believe their existing plans to boost infrastructure spending are already a significant boost to the economy, and they want to see what happens when it reopens.
A set of figures released today shows that household savings increased during the shutdown, but will people have the confidence to spend?
The scale of government support for businesses and employees in recent months probably justifies New Deal-style rhetoric. Extending support to that level may still be required, and is far from being ruled out.
But for now, they are holding fire as they assess the permanent scars of the UK economy.
The prime minister acknowledged that the jobs that existed at the start of the pandemic could be lost, but said that a new “opportunity guarantee” would ensure that every youth had the opportunity for an apprenticeship or placement.
He said that the UK “cannot continue to be prisoners of this crisis” and that the government is “preparing now, slowly and cautiously, to emerge from hibernation.”
“This country needs to be prepared for what lies ahead,” he said, in preparation for an “economic aftershock.”
“We must use this moment now … to plan our response and solve the problems that lit up most brutally in that Covid flash.”
Johnson said his response would not be a return to the austerity that followed the financial crisis.
He tried to calm Tory’s fears of moving to the left, saying, “I am not a communist.”
Instead, he claimed that he had been inspired by American President Franklin D Roosevelt, who pulled the United States out of the Great Depression with his New Deal in the 1930s.
Following the Wall Street accident of 1929, President Roosevelt launched one of the largest and most expensive government programs in the United States, which included the construction of schools, hospitals, and dams.
‘Is not sufficient’
Labor leader Sir Keir Starmer said: “We are facing an economic crisis, the largest we have seen in a generation, and the recovery needs to match that. What has been announced amounts to less than £ 100 per person.
“And it is the new announcement of many promises and manifest commitments, so it is not enough.”
The Labor leader added: “We are not going to argue against a recovery plan, but the focus should be on jobs.”
The CBI said the prime minister had established the “first steps on the road to recovery.”
But CEO Carolyn Fairbairn added: “The focus on bailing out viable businesses cannot fail as the UK seeks recovery, or previous efforts could be wasted.”