Response to winter economy plan: sensible but not costless

The Adam Smith Institute has released the following statement in response to the Winter Economy Plan.

Matthew Lesh, Head of Research at the Adam Smith Institute, said:

“The Winter Economy Plan is a sensible response to the need for greater restrictions on private sector activity over the coming months. It makes sense to replace the furlough scheme — that paid people to not work — with a wage subsidy scheme that helps struggling but viable businesses to keep employees on the job part time. Extending loan schemes and VAT cuts is also a measured response to lessen the shock as the Government furlough scheme is rolled back. 

“This is not costless. The Government must resist becoming addicted to spending. Temporary spending is sensible to keep struggling businesses afloat, but in the longer run we are going to have to get the national accounts in order by reducing ongoing spending. 

“If we are going to adapt to these difficult times and recover successfully, the Government must reduce the tax burden and cut red tape that undermines entrepreneurial dynamism.”

Notes to editors:  

For further comments or to arrange an interview, contact Matt Kilcoyne: matt@adamsmith.org | 07904 099599.

The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.