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One year on, the Chancellor needs to show his resolve and plan for future recovery

When Rishi Sunak was appointed as Chancellor of the Exchequer on 13 February 2020, he could not have imagined the 12 months ahead of him.  As Britain’s second youngest Chancellor, Rishi Sunak has faced economic challenges in a year that the majority of his predecessors would not have faced during their entire term.

Sunak started-off strongly, reacting quickly to the major economic shock of the March lockdown and the introduction of his flagship support package – the furlough scheme.  However, what followed was a piecemeal set of measures intended to wean the country away from Government support as soon as possible. The Chancellor struggled with keeping the country on economic life support against his own desire of fiscal responsibility.  In hindsight, the ‘Eat Out to Help Out’ scheme and SDLT cut were positive failures, when in reality, a clearer line of sight was required around long-term business support.  One year on, we have still not heard from the Chancellor on his plan to take the country through economic recovery, and the constant murmurs of imminent tax changes leave businesses concerned and confused.

The Chancellor has shown his stubbornness on more than one occasion by declaring an end to the furlough scheme, only having to return to it several times over – we should not be surprised if there was yet another extension beyond April.

The last few months of 2020 and the early announcements in January 2021 suggested the Chancellor’s star had faded from the heights of March.  The Chancellor appears a jaded figure and no longer in the Government limelight – contrast that to the Spring and Summer months when the Chancellor would be making almost weekly appearances and outshining the Prime Minister.

Sunak’s lack foresight is concerning, with some now starting to question whether he is up to leading the country through the economic recovery, citing his inexperience as a weakness.  The Chancellor did a fantastic job to introduce the furlough scheme and the immediate package of support, but what followed has been underwhelming.

What about the next 12 months?  The Chancellor needs to act quickly again and he should confirm an extension to the furlough scheme and other business support measures to the end of 2021, with an overlapping package of new measures to aid the economic recovery.  The Chancellor can’t afford to be stubborn and needs a clear plan to lead the economy to recovery ‘whatever it takes’.

Without question, the former Chief Secretary to the Treasury has faced the most gruelling 12 months and there are not many in the current Government that would have been up to the challenge; in the later months, Sunak has certainly lost his spark or maybe his attentions are now focussed on his next job.

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