Tony Yates's picture
Affiliation: 
University of Birmingham
Credentials: 
Professor of Economics

Voting history

COVID-19 and UK Public Finances

Question 2: What is the best way to (eventually) reduce public deficits and debt?

Answer:
Tax increases
Confidence level:
Confident
Comment:
I'd have preferred an option to say 'tax increases and public spending cuts'. Obviously many of the support measures will fade as the pandemic passes [presuming it does]. I wrote 'tax increases' to signal that in the longer term a larger and more resilient state is likely to be needed to put us in a better position to fight future pandemics, and also to redress some fo the regressive aspects of them [eg higher pay for teaches/healthworkers, more and better quality social housing].

Question 1: How urgently should the UK government address the rise in public debt?

Answer:
There is no need to take or announce any budgetary actions to reduce the deficit or the public debt until the end of the pandemic
Confidence level:
Confident
Comment:
Deficit spending now is needed to ensure continued compliance with the lockdown, and to minimise the risk of an overhang from the self-engineered shutdown when restrictions are lifted. It will also be needed for some time to come after restrictions are lifted. A fiscal contraction now would be counter-productive.

Covid-19: Economic Policy Response

Question 3: Which would be the maximal public debt you would be willing to tolerate if used effectively (as in your answers to 1 and 2 above) to support an economic recovery?

Answer:
>140% of GDP
Confidence level:
Not confident
Comment:
With real rates so low, I don't think worries about the debt burden should or will constrain aid and stimulus to counter the effects of the virus crisis. What will constrain it is politics and the administrative unpreparedness of the tax and benefit system to do it quickly and error free.

Question 2: Which of the following would have the second greatest impact in mitigating the economic effects of the coronavirus economic crisis in the UK?

Answer:
Government transfers to and bailouts of businesses
Confidence level:
Confident

Question 1: Which of the following would have the greatest impact in mitigating the economic effects of the coronavirus economic crisis?

Answer:
Government transfers to and bailouts of businesses
Confidence level:
Confident
Comment:
I think we should and probably will end up doing most of these as the seriousness of the crisis changes the political imperatives in the govt.

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