It is too early to say what the cost of COVID-19 will be to taxpayers and the issue is fraught with challenges, senior Treasury officials said, as they were asked about the £ 372bn (526bn dollars) of taxpayer dollars who have so far been involved in the pandemic.
The parliamentary session was examining the latest COVID-19 cost tracking figures from the National Audit Office (NAO).
The NAO “tracks the gross costs of public spending, but the response to the cost of COVID in the country is broader than that and will mostly depend on the extent to which the pandemic will have a lasting medium-term impact on the economy. Said Tom Scholar, Permanent Secretary of HM Treasury.
“In terms of cost to businesses, jobs and income, then ultimately tax revenue and public money … this is the figure that is unknown and we will debate it for a few years.”
He added that the NAO’s £ 372 billion figure “is a good and reliable snapshot based on what we know now”, but it does not take into account, for example, which programs are demand-driven where the cost will depend on the adoption, such as COVID testing and vaccination.
“We just don’t know this, but all of these things will have a big impact on public spending figures.”
He also said that a major factor will be the extent to which companies are able to repay the loans they have received.
The NAO estimates that £ 92bn in loans have been guaranteed by the government and the Bank of England, of which £ 26bn is expected to be written off.
Meanwhile, Cat Little, managing director of public spending at HM Treasury, said estimating the cost of programs like the NHS Test and Trace “has had real challenges” when it comes to “managing its modeling. demand”.
Another challenge highlighted by Treasury officials was deciding exactly what the cost of COVID is. It gets tricky when it comes to Universal Credit (UC) and the NHS.
“When people register a UC claim … you can’t individually track what’s motivated by COVID. What you can do is estimate the impact of the economy on unemployment and wages, ”said Conrad Smewing, director of public spending, HM Treasury.
He said it wasn’t always easy to label something as COVID or not COVID, in which case “it’s better to do top-down statistical economic analysis.”
The NAO tracker that served as the basis for questioning brings together data from across the UK government and provides cost estimates for measures announced in response to the coronavirus pandemic.
The purpose of the tracker is to increase transparency and promote parliamentary oversight and accountability.
He revealed that the government planned to spend £ 372 billion on COVID-19 measures in May 2021.
It was made up of £ 150.8bn for business support, £ 97.4bn for health and social care, £ 54.9bn for personal support, £ 65bn for public services and emergency response and £ 3.5 billion for operational costs.
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