Government of Great Britain folds social protection programs introduced during a pandemic. According to Bloomberg, the termination of support measures will leave the working family of Britain without the necessary assistance, which will increase the gap between the rich and poor.
During the action of programs, the authorities were additionally invested in the economy of 80 billion pounds of sterling (107 billion dollars). During a pandemic, the government compensated for a temporary vacation to citizens to preserve jobs, and paid elevated benefits to six millions of people. These two measures softened the blow from Lokdanov and prevented unemployment splash. September 30 will cease to work the vacation program, and on October 6 – a program for payments for elevated benefits.
Some financiers and politicians expressed discontent with the abolition of support measures, as the growth of the economy slowed down, and inflation reached record indicators. The economist in Britain Deustche Bank in London Sanjay Raja criticized the cessation of payments of elevated benefits. “This will significantly affect household expenses. It is possible that the restriction of the proposal and the weakening of consumer confidence will reverse the economy,” he said. The same opinion adheres to the economist Bloomberg Dan Hanson. According to his forecasts, unemployment will grow above the expectations of the Bank of England, and the purchasing power will decrease.
The Treasury Chancellor of the UK Rishi Sunak is confident that now the right time to complete the programs, as the economy is restored after a pandemic, and one million vacancies are opened on the market. “This does not mean the termination of our support. Our employment plan will help people find a job,” the chancellor promised.
Senior Economist of the Joseph Raantree Research Foundation on Rebecca McDonald Poverty Problems believes that the revenues of British families will significantly fall, and the cost of items will grow. The budget of households will hit a 12% increase in electricity bills from October 1 and an increase in taxes in April. The combination of low incomes and high costs can lead to an increase in inequality and social tension.
Earlier in September, Analytics The Economist Intelligence Unit (EIU) had already predicted the growth of unemployment in the UK and other European countries due to the completion of the Program for the Conservation of Jobs. According to forecasts, the number of unoccupied citizens will increase from 9.2 percent in 2020 to 10.1 percent in 2021. Analysts noted that many of the British entrepreneurs are either going to cut the staff, or are ready to offer only partial employment to employees from vacation.