Business Secretary: opening up economy is the route to post-Covid recovery

2 March 2021, 09:09

By Kate Buck

Kwasi Kwarteng has played down fears tax increases could be on the way to pay for the Covid-19 pandemic, insisting opening up the economy is the "best remedy."

Speaking with LBC's Nick Ferrari, the Business Secretary said that it would be "likely" the Furlough Scheme will be extended once again, as the nation begins on its roadmap out of lockdown.

Chancellor Rishi Sunak will be announcing his Spring budget tomorrow in the House of Commons, but after almost a year of repeated lockdowns the cost of the pandemic is higher than ever.

In November the Office for Budget Responsibility said borrowing would be £394billion for the current financial year (April 2020 to April 2021) - the highest figure ever seen outside wartime.

Read more: Budget 2021 - What to expect from Rishi Sunak’s announcement

Read more: Chancellor to unveil £520m help to grow scheme for small firms

It is feared that tax rises are on the way to deal with the crisis, but Mr Kwarteng said that growing the economy is "key" to paying for the measures brought in to keep the country running.

"Obviously we have to balance the books over time, but I am a low tax Conservative and the real key Nick is to grow the economy," he told Nick.

"I think the best remedy for the deficit, the best remedy for the economy is to open up the economy, allow people to get on with their lives, allow businesses to start trading again.

"The vaccine rollout has worked very successfully as you pointed out, and I think if we stick to the road map there’s every chance that the second half of this year will see the economy grow.

"Through that growth I think we’ll be able to tackle the deficit."