NatWest Chairman calls for 'targeted' financial support for struggling businesses

15 June 2021, 10:52

By Tim Dodd

Natwest Chairman Sir Howard Davies has told LBC 'targeted measures' are now needed for airlines, theatres, and other sectors which continue to struggle as the June 21st lockdown easing is delayed. 

The conversation comes as Boris Johnson faces mounting anger after delaying "Freedom Day" in England amid accusations he let the Delta variant run rampant by failing to close borders quickly enough.

Nick Ferrari began by asking Sir Howard "Did the Prime Minister make the right call yesterday in your view?"

Sir Howard replied: "I think it was an inevitable one given the numbers that we've seen. It's not welcome to anybody I don't think. The problem I think the Government's had is sometimes they give firm dates which appear to be unrelated to what's going on in Covid, and other times they go back to the numbers.

"If they stick with the numbers then it looks as if unwinding is a mistake, so I think that this was inevitable."

Nick then asked if there was a role for economists in the government's Covid committees.

Sir Howard said: "Yes. Perhaps not just an economist, but people who understand social psychology for example, because people react differently to different types of lockdowns or different types of instructions.

"And they weren't getting advice of that sort. There's advice that has been proffered to them, perhaps unofficially by a lot of people, but I think right at the beginning that was a mistake."

Nick then said: "Your business teams will be working with businesses in the wedding industry, in the hospitality sector. It's damn tough for them. These extra four weeks could be make or break for them couldn't it?"

"This is no longer a generalised economic problem," Sir Howard replied.

"With each successive lockdown, businesses have found ways of working around it. I don't mean that they've not been following, but if you recall at the beginning, everyone froze and nothing happened - builders didn't come and work in your garden, even though that was a completely safe thing to do.

"I think it's now a question of targeted measures, not a broad underpinning of the economy because I think the economy generally is doing quite well."

"So should some kind of furlough stay in a targeted area in airlines, in theatres or whatever it might be?" asked Nick.

Sir Howard said: "I think the Government should look at that if they're genuinely thinking that part of the economy will be closed down over the summer.

"And I think it's perfectly reasonable for the Chancellor to pull back on the big underpin of the whole economy - on furlough schemes and the loan schemes, but looking at targeted support for the sectors which are now really struggling would, I think, be worth doing."