Thursday November 26 2020 | thetimes.co.uk | No 73327 2Gy(7HB7E2*OTSLOL( |||+&!:
Rishi Sunak said that Britain’s eco-
nomic emergency had only just begun
as the long-term damage that the pan-
demic has inflicted on growth, jobs and
the public finances was laid bare.
The chancellor froze public sector
pay and reduced foreign aid yesterday
but must still find tens of billions in tax
rises and spending cuts to stop debt
running out of control.
The independent budget watchdog
said that the economy would be 11.3 per
cent smaller this year than was forecast
before Covid-19, the biggest fall for 300
years, and still 3 per cent smaller by
2025 owing to “long-term scarring”.
It is not forecast to return to 2019
levels until late in 2022, meaning that
coronavirus has cost the country three
years of growth, according to the Office
for Budget Responsibility (OBR).
It said that between £21 billion and
£46 billion in tax rises and spending
cuts would be needed by 2025 to
arrest rising debt levels after years of
record borrowing, including almost
£400 billion this year, the highest in
peacetime.
The OBR said that the “heightened
vulnerability” of ballooning debt was
compounded by changes to the nature
of government borrowing that left it
“twice as sensitive” to short-term inter-
est rate increases. It also said that house
prices would drop by more than 8 per
cent next year and not recover until
2022.
Nevertheless, Mr Sunak announced
new spending, including for a “level-
ling-up” regeneration fund for deprived
areas. Boris Johnson told the 1922 Com-
mittee of Tory backbenchers that he
thought the OBR forecasts were too
“gloomy”. The prime minister said he
would wager that a combination of
mass testing and vaccines meant that
Britain’s economic position would be
better than the forecasts.
Other measures in the spending
review include:
6 Confirmation that aid will be cut
from 0.7 per cent to 0.5 per cent of
happy. You were the greatest of them
all. Thank you for having existed,
Diego. We’re going to miss you all our
lives.”
A funeral service, which is likely to
prompt the biggest outpouring of
public emotion in Argentina since the
death of Eva Perón in 1952, could take
place this week. Government sources
said that it could be held at the presi-
dential palace but the most likely
location was the Diego Armando
Maradona stadium in Buenos Aires.
Maradona struggled with his health
for decades after developing a cocaine
addiction that blighted his last years on
the pitch and caused psychological and
physical problems.
He was admitted to hospital in 2000
and 2004 with heart problems and in
2005 had gastric bypass surgery to tryto treat his obesity. In recent days his
family said that he was “anxious and
nervous” and they were considering
travelling to Cuba, where he had
previously been treated for addiction.
There was controversy wherever he
went during a colourful career in
Argentina, Spain and Italy. Maradona
had mesmerising football skills
bolstered by physical strength, an
Continued on page 5, col 1
Obituary, pages 54-
Football in mourning, pages 70-Francis Elliott Political Editor
Steve Swinford Deputy Political Editor
Philip Aldrick Economics Editor
national income next year with no
timetable for its restoration.
6 A pay freeze next year for millions of
public sector workers, although the
lowest paid will receive increases of up
to £250 and Mr Sunak says that the
majority will see their pay rise.
6 Funding for councils that assumes
rises in council tax of up to 5 per cent
next year.
6 Above-inflation increases for day-
to-day public spending but less than
previously promised in some areas.
6 A further £55 billion earmarked for
pandemic spending next year on top of
the £280 billion this year.
Mr Sunak told the Commons that
“our health emergency is not yet over,
and our economic emergency has only
just begun. So our immediate priority is
to protect people’s lives and livelihoods.
“But today’s spending review also
delivers stronger public services, pay-
ing for new schools, better schools and
safer streets, and it delivers a once-in-a-
generation investment in infrastruc-
ture, creating jobs, growing the
economy and increasing pride in the
places we call home.”
Anneliese Dodds, the shadow chan-
cellor, criticised the pay freeze for
public sector workers and said that the
spending review “takes a sledgeham-
mer to consumer confidence”.
Paul Johnson, director of the Insti-
tute for Fiscal Studies, said that while
the chancellor had set out plans for
“truly astonishing” levels of spending
the total would be still higher. He said
that Mr Sunak had cut some Whitehall
spending against totals promised in
March and had failed to include items
such as keeping universal credit
increases in place next year or provi-
sion for the pandemic into 2022.
“Each of these assumptions is
questionable,” he said. “It seems more
likely than not that spending will end
up significantly higher than set out to-
day, and so borrowing in 2024-25 will be
considerably more than the £100 billion
forecast by the OBR. Either that or we
are in for a pretty austere few years once
again, or some significant tax rises.”
The Resolution Foundation, an
Continued on page 2, col 3Millions mourn Maradona’s death
Sean O’Neill Chief Reporter
Stephen Gibbs Sao PauloDiego Maradona, the Argentine
football genius regarded by many as the
greatest player ever seen, died
yesterday aged 60.
Maradona, notorious for his “hand of
God” goal against England in the 1986
World Cup, suffered a heart attack at
his home in Tigre, near Buenos Aires.
He had been recuperating from an
operation to remove a blood clot from
his brain. A neighbour, a doctor at a
local rugby club, tried to save his life
after family members called for help.
Nine ambulances attended.
Declaring three days of national
mourning, President Fernández of
Argentina said: “You took us to the top
of the world. You made us immensely£2 £1.10 to subscribers
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CARLO FUMAGALLI/APDiego Maradona lifting the 1986 World Cup trophy in Mexico City, the tournament of his “hand of God” goal against EnglandINSIDE
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