The chancellor’s measures for supporting employers will help many – but there’s still no remedy for the most vulnerable

Editorial: Unlike the coronavirus itself, there is a ready treatment immediately available for the potential economic damage wrought by this invisible enemy

Rishi Sunak faces a formidable task in the months ahead (AP)

Containment of the coronavirus contagion is an approach that applies as much to the economy as it does to the general population. And limiting and delaying the financial contagion rushing through the economy is the urgent imperative that Rishi Sunak, the chancellor, has had to turn his attention to for the third time in a little over a week since his formal Budget. Never has a chancellor had so much to do in so short a time. Nor too in the nation’s history has a British government subsidised wages on a national scale. It is a bonfire of economic vanities.

So Mr Sunak mostly seems to have “got it”, albeit in a piecemeal way. The crucial task is to protect employment, and that now entails underwriting hundreds of enterprises, large, medium and small across the land. The logistics of such an exercise – not even seen in wartime – are formidable, and the schemes will never be perfect. However, the plan to pay 80 per cent of the majority of salaries by subsidising wages is precisely correct. Further help for the self-employed is also wise, as is a relaxed and enhanced regime for universal credit and statutory pay. There is still, though, an impression that those in the “gig economy” will still fall through the gaps in the safety nets.

Even if all of this, on top of previous announcements, entails doubling the total national debt, it will be justified. First, because the alternative to such a splurge would be a still worse depression over a much longer time. The world does not wish the 2020s to turn into the equivalent of the 1930s or 1980s: decades of chronic unemployment and a vast waste of human potential.

Second, because the coronavirus emergency is essentially a short-term phenomenon, and one that can be reasonably expected to subside within a year, it can be contained. After the economic malignancy has been restrained, then the public finances can be repaired, though it may take many years to unwind the consequences of the Covid-19 crisis on debt levels. After all, we are still living with the effects of the bank rescues of 2009 and 10 years of sluggish economic growth.

Third, at least for the time being, the UK remains fortunate to able to borrow at very low interest rates with very long-dated bonds – so the burden of debt interest is more manageable than it otherwise might be.

Taken with the emergency powers in the Coronavirus Bill, the ban on housing evictions and the closure of so many venues, such state intervention is extraordinary. It has been likened by one MP to “war socialism”, and it is to this Conservative government’s credit that it has double-bagged and dumped its vestigial Thatcherite orthodoxies, though one apt phrase from that era springs to mind now – “there is no alternative”.

Such is the emerging scale of the complete loss of revenues for businesses across the economy that to prevent the economic equivalent of organ failure, more action is unavoidable. If an airline, pub, museum, racecourse or building firm is going to be deprived of its customers for the best part of a year then no realistic size of bank loan can hope to carry them through. No matter how easy the terms, such a burden of debt would overwhelm even the healthiest of corporate balance sheets. Many firms will now have an alternative to making redundancies and pushing the wider economy into a tailspin of decline.

Still, as our reporting on food banks demonstrates, there will be those already at the bottom of the economic pile who should be protected as the crisis continues. In particular, the government has not yet ensured that the most vulnerable, such as people with disabilities, older people and those who depend on food banks, are being supplied with the basic means of sustenance. With panic buying showing no signs of abating, this is the next urgent task for ministers.

Unlike the coronavirus itself, there is a ready treatment immediately available for the potential economic damage wrought by this invisible enemy. Awesome globally coordinated action has been tried and succeeded before, and, whatever the risks, there is no alternative to it once again.