The UK economy will take longer to recover from the coronavirus outbreak than from the 2008 financial crisis, Alistair Darling has said.
In a stark warning, the former Labour chancellor said the economic hit from the global pandemic would be “much, much worse because we are not yet in control of events”.
Lord Darling, who led the Treasury during the financial crash, said the UK’s ability to recover depends on decisions the government takes in the next three to four weeks and called for a clear plan on how the lockdown will be lifted.
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Boris Johnson is under pressure to reveal government plans to ease strict restrictions on daily life which have been in place since March, amid fears a sustained lockdown will devastate the economy.
Speaking at a briefing for the Tony Blair Institute for Global Change, Lord Darling said compared the coronavirus crisis to 2008, saying: “I’m afraid this is much, much worse because we’re not yet in control of events.
“You can deal with a bank crash fairly quickly but this is taking a lot longer.”
He said the government has “no alternative” but to support the economy, adding: “When things collapse all about you, the government is the lender and insurer and sometimes the provider of last resort.”
Ministers must not obsess about debt levels as the long-term impact of allowing unemployment levels to rise and businesses to collapse will be far worse, he said.
Lord Darling added: “If we let people go out of work, lose skills, if we let firms collapse on a dramatic scale, we will pay the cost of that for years to come.”
He also urged the government to set out a plan for getting out of the lockdown.
The former chancellor said: “I’m not arguing that that can happen today or next week. We need for health reasons to do what we do at the moment, to a large extent remaining at hope.
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Staff react outside Salford Royal Hospital in Manchester during a minute’s silence to pay tribute to the NHS staff and key workers who have died during the coronavirus outbreak
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Staff inside Camberwell bus depot in London, during a minute’s silence
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NHS staff at the Mater hospital in Belfast, during a minute’s silence to pay tribute to the NHS staff and key workers who have died during the coronavirus outbreak.
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Shoppers observe a minute’s silence in Tescos in Shoreham
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Firefighters outside Godstone fire station
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6/30 Salford Royal Hospital
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7/30 Salford Royal Hospital
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Hospital workers take part in a protest calling on the British government to provide PPE across Britain for all workers in care, the NHS and other vital public services after a nationwide minute’s silence at University College Hospital in London
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A school children’s poster hanging outside Glenfield Hospital during a minute’s silence
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A man holds a placard that reads “People’s health before profit” outside St Thomas hospital
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Staff members applaud outside the Royal Derby Hospital, following a minute’s silence
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Cabinet Secretary Mark Sedwill, Prime minister Boris Johnson and Chancellor of the Exchequer Rishi Sunak, stand inside 10 Downing Street, London, to observe a minutes silence in tribute to the NHS staff and key workers who have died during the coronavirus outbreak
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13/30 University College Hospital, London
Hospital workers hold placards with the names of their colleagues who have died from coronavirus as they take part in a protest calling on the British government to provide PPE
AP
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Staff at Waterloo Station in London, stand to observe a minute’s silence, to pay tribute to NHS and key workers who have died with coronavirus
AP
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Medical staff at the Louisa Jordan hospital stand during a UK wide minutes silence to commemorate the key workers who have died with coronavirus in Glasgow
Getty
16/30 London
An NHS worker observes a minute’s silence at Chelsea and Westminster Hospital
Reuters
17/30 Chelsea and Westminster Hospital in London
AFP via Getty
18/30 Belfast, Northern Ireland
NHS staff observe a minutes silence at Mater Infirmorum Hospital
Reuters
19/30 Plymouth
NHS workers hold a minute’s silence outside the main entrance of Derriford Hospital
Getty
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NHS Frimley Park Hospital staff at the A&E department observe a minute’s silence
Getty
21/30 Mater Infirmorum Hospital
People applaud after a minutes silence in honour of key workers
Reuters
22/30 Waterloo Station, London
AP
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Wreaths laid outside Sheffield town hall
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A group of trade unionists and supporters standing outside Sheffield town hall
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First Minister Nicola Sturgeon stands outside St Andrew’s House in Edinburgh to observe a minute’s silence in tribute to the NHS staff and key workers who have died during the coronavirus outbreak
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Staff stand outside the Royal Derby Hospital, during a minutes silence
PA
27/30 London
Police officers observe a minutes silence at Guy’s Hospital
Reuters
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A woman standing outside Sheffield town hall
PA
29/30 Royal Derby Hospital
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30/30 Leicester,
NHS workers during a minute’s silence outside Glenfield Hospital
Getty
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Staff react outside Salford Royal Hospital in Manchester during a minute’s silence to pay tribute to the NHS staff and key workers who have died during the coronavirus outbreak
PA
2/30
Staff inside Camberwell bus depot in London, during a minute’s silence
PA
3/30
NHS staff at the Mater hospital in Belfast, during a minute’s silence to pay tribute to the NHS staff and key workers who have died during the coronavirus outbreak.
PA
4/30
Shoppers observe a minute’s silence in Tescos in Shoreham
Getty
5/30
Firefighters outside Godstone fire station
PA
6/30 Salford Royal Hospital
Getty
7/30 Salford Royal Hospital
PA
8/30
Hospital workers take part in a protest calling on the British government to provide PPE across Britain for all workers in care, the NHS and other vital public services after a nationwide minute’s silence at University College Hospital in London
AP
9/30
A school children’s poster hanging outside Glenfield Hospital during a minute’s silence
Getty
10/30
A man holds a placard that reads “People’s health before profit” outside St Thomas hospital
Getty
11/30
Staff members applaud outside the Royal Derby Hospital, following a minute’s silence
PA
12/30
Cabinet Secretary Mark Sedwill, Prime minister Boris Johnson and Chancellor of the Exchequer Rishi Sunak, stand inside 10 Downing Street, London, to observe a minutes silence in tribute to the NHS staff and key workers who have died during the coronavirus outbreak
PA
13/30 University College Hospital, London
Hospital workers hold placards with the names of their colleagues who have died from coronavirus as they take part in a protest calling on the British government to provide PPE
AP
14/30
Staff at Waterloo Station in London, stand to observe a minute’s silence, to pay tribute to NHS and key workers who have died with coronavirus
AP
15/30
Medical staff at the Louisa Jordan hospital stand during a UK wide minutes silence to commemorate the key workers who have died with coronavirus in Glasgow
Getty
16/30 London
An NHS worker observes a minute’s silence at Chelsea and Westminster Hospital
Reuters
17/30 Chelsea and Westminster Hospital in London
AFP via Getty
18/30 Belfast, Northern Ireland
NHS staff observe a minutes silence at Mater Infirmorum Hospital
Reuters
19/30 Plymouth
NHS workers hold a minute’s silence outside the main entrance of Derriford Hospital
Getty
20/30
NHS Frimley Park Hospital staff at the A&E department observe a minute’s silence
Getty
21/30 Mater Infirmorum Hospital
People applaud after a minutes silence in honour of key workers
Reuters
22/30 Waterloo Station, London
AP
23/30
Wreaths laid outside Sheffield town hall
PA
24/30
A group of trade unionists and supporters standing outside Sheffield town hall
PA
25/30
First Minister Nicola Sturgeon stands outside St Andrew’s House in Edinburgh to observe a minute’s silence in tribute to the NHS staff and key workers who have died during the coronavirus outbreak
PA
26/30
Staff stand outside the Royal Derby Hospital, during a minutes silence
PA
27/30 London
Police officers observe a minutes silence at Guy’s Hospital
Reuters
28/30
A woman standing outside Sheffield town hall
PA
29/30 Royal Derby Hospital
PA
30/30 Leicester,
NHS workers during a minute’s silence outside Glenfield Hospital
Getty
“But the government now has to give the public confidence, and dare I say hope, in relation to how things will return to where people can get out and about and go to work.”
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Lord Darling, a vocal advocate of staying in the EU, called for an extension to the Brexit transition period while the outbreak continues as he said pressing ahead during the crisis was like “shooting yourself in both feet”.
He added: “I don’t think anyone would lose face if you put the thing off for 18 months or whatever.”
Elsewhere, it emerged that business secretary Alok Sharma is working up plans to get businesses back up and running with a “workplace by workplace” approach.
A spokesman for the Department for Business, Energy and Industrial Strategy said: “The government has already set out five clear tests to consider before making any adjustment to its approach.
“It is only right the we work together with industry and unions to ensure workplaces are safe for both those in work now and for those going back to work as government measures develop.”
