Ryanair said the MAX – which has been grounded since March 2019 – was the “most regulated in aviation history” and boss Michael O’Leary predicted passengers “will love these new aircraft”.
Please use Chrome browser for a more accessible video player
Boeing 737 MAX completes test flight more than year after ban
It would help “recover lost traffic and help the nations of Europe recover their tourism industry, and get young people back to work across the cities, beaches, and ski resorts of the EU”, he added.
The MAX was banned from flying worldwide after a crash in Ethiopia last year in which 157 people were killed – which came six months after a crash in Indonesia when 189 died.
Boeing has since made a series of changes focusing on flight control software and tested the aircraft under intense scrutiny from America’s FAA and Europe’s EASA regulators.
Ryanair said the plane delivers improved fuel efficiency and would help it to return to growth across Europe in 2021 after demand was battered by the coronavirus pandemic this year.
The airline’s purchase of 75 new MAX-8200 aircraft comes on top of 135 it has already ordered, with the total number, 210, valued at more than $22bn (£16bn).
It expects to take delivery of the first of them over a four-year period from early 2021 – and has agreed a reduction in the price as part of a compensation package agreed with Boeing after the grounding of the MAX resulted in delivery delays.
Ryanair said it would use the new aircraft to grow low fare services into new markets in Europe, encouraging consumers and the travel industry “to recover from the COVID-19 pandemic, as quickly as multiple vaccines are rolled out in 2021, and life returns to normal”.
Mr O’Leary described it as a “fabulous aircraft”. It will be used to replace some of the airline’s older Boeing fleet which will remain grounded until demand for flights returns.
“But as soon as the COVID-19 virus recedes – and it will in 2021 with the rollout of multiple effective vaccines – Ryanair and our partner airports across Europe will – with these environmentally efficient aircraft – rapidly restore flights and schedules,” Mr O’Leary said.
Boeing chief executive Dave Calhoun said: “We are gratified that Ryanair is once again placing its confidence in the Boeing 737 family and building their future fleet with this enlarged firm order.
“Boeing remains focused on safely returning the full 737 fleet to service and on delivering the backlog of airplanes to Ryanair and our other customers in the new year.”
The deal comes after International Airlines Group, owner of British Airways, signed a letter of intent – but not a firm order – to buy 200 Boeing MAX planes, in June.
Airlines remain under intense pressure as coronavirus restrictions crush demand for flights.
Ryanair this week reported that traffic in November was 82% lower than a year ago.
Last month it reported a half-year loss of €197m (£144m) for the six months to September.
The US has recorded a record number of daily deaths and cases as the COVID crisis worsens in the country.
The number of Americans hospitalised due to COVID-19 topped 100,000 for the first time on Wednesday, with the nation recording some 200,000 new cases a day, according to the COVID Tracking Project.
Topping 2,700 deaths a day, the country has now a total of over 270,000 deaths and 13.9 million cases. Officials warn that those numbers will rise especially with millions of Americans travelling home after Thanksgiving weekend.
“The reality is December and January and February are going to be rough times. I actually believe they are going to be the most difficult time in the public health history of this nation,” Dr Robert Redfield, head of the US Centres for Disease Control and Prevention, said on Wednesday.
Many of the largest outbreaks are currently in the country’s midwest with some states recording thousands of cases a day.
“As we sit here today, 90% of our hospitals in this nation are actually in what we call one of the hot zones in the red zone, therefore at risk for increased hospitalisation and potential to negatively impact hospital capacity. 90% of all of our long term care facilities now are in what we call high transmission zones,” said Redfield.
Some cities have reinstated strict measures amid rising cases.
Notably, New York City decided to close schools in November when the COVID-19 positivity rate passed 3% but has gradually brought students back to in-person learning.
Some Americans returning from Thanksgiving faced new restrictions. Los Angeles County issued a new stay at home order prohibiting gatherings.
At the state level, California Governor Gavin Newsom said that “if these trends continue, we’re going to have to take much more dramatic, arguably drastic, action.”
Dr Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, earlier this week that the crisis in the US would not “all of a sudden turn around.”
“So clearly in the next few weeks, we’re going to have the same sort of thing. And perhaps even two or three weeks down the line … we may see a surge upon a surge,” Fauci said.
The operators of the Basslink undersea power cable between Tasmania and Victoria have been told to pay the Tasmanian Government almost $40 million in compensation after it failed to prove a major power outage in 2015 was beyond its control.
A failure in the Basslink cable contributed to the Tasmanian energy crisis starting in December 2015, when a major outage put the cable out of operation for almost six months.
Coupled with almost-record low dam reserves, the State Government was forced to ship in 80 diesel generators and fire up the Tamar Valley Power Station to keep the lights on.
The crisis prompted a parliamentary inquiry into how it all happened, with Basslink and Hydro Tasmania — the state-owned electricity company — offering different explanations for the failure of the cable.
Basslink concluded the cause of the failure was unknown, but Hydro Tasmania blamed the cable operator, claiming the cable was over capacity, causing it to degrade.
The State Government adopted Hydro’s explanation, demanding millions of dollars in compensation from Basslink.
The dispute between the Government and the cable operator went into arbitration in April — with the decision announced tonight.
In a statement, Basslink chief executive officer Malcolm Eccles said the company was “extremely disappointed with the outcomes” of three arbitrations involving Basslink, the State of Tasmania and Hydro Tasmania.
The arbitrations were required to “resolve a number of disputes relating to the outage of the Basslink interconnector in December 2015,” the statement said.
The arbitrator found in favour of the State and Hydro Tasmania in the disputes, awarding damages of $38.5 million against Basslink.
“He further decided that a force majeure event had not occurred, and declared that Basslink’s claim for unpaid fees of $31 million against Hydro Tasmania relating to the period of the outage was not recoverable,” the company said.
Basslink Chief Executive Malcolm Eccles said that the organisation would take time to “review the rulings and determine the next steps”.
Basslink said in the meantime it “continues to operate efficiently and reliably, connecting Tasmania to the national electricity market”.
In a statement, Tasmania’s Minister for Energy Guy Barnett said the details of the decision were “complex and we are currently working through the arbitrator’s award and its implications”.
The 298-kilometre cable — which connects Tasmania to the national electricity grid, as well as fibre optics for data — has been out of action a number of times since it began operations in 2006.
The Federal Government has promised to fast-track the Marinus Link project — a second underwater energy cable across Bass Strait — but questions remain about the $3.5 billion project, including who will pay for it.
GAZA (Reuters) – The United Nations agency for Palestinian refugees paid the salaries of 30,000 Palestinian staff across the Middle East for last month, but a funding shortfall may still hinder payment in December, officials said on Wednesday.
UNRWA finds itself in limbo after the U.S. election – President Donald Trump ended all U.S. payments, but while Palestinians hope President-elect Joe Biden’s administration will at least partially resume payments, that could take months.
The agency said last month it had run out of money to pay salaries after two years of funding cuts by the United States and other donors, including Arab Gulf states.
Adnan Abu Hasna, an UNRWA spokesman in Gaza, said the November salary payments were made possible only by a $20 million loan from the United Nations, $12 million in new pledges and an advance from Sweden on its 2021 contribution.
“The payment of December remains uncertain and we are in need of $38 million to pay the salaries of our 30,000 staff,” Abu Hasna told Reuters.
UNRWA provides education, health and relief services to around 5.7 million registered Palestinian refugees, including those in Gaza and the occupied West Bank and East Jerusalem.
Also on Wednesday, Israel handed over a backlog of billions of shekels in tax money to the Palestinian Authority. The taxes, managed by Israel under interim peace accords from the 1990s and usually handed over monthly, make up more than half of the PA’s budget.
The 3.77 billion shekels ($1.14 billion) transfer is the first since June, when the Palestinians snubbed the handover due to Israeli Prime Minister Benjamin Netanyahu’s plans, currently suspended, to annex parts of the West Bank.
The PA has been unable to pay full wages of its 130,000 employees in the past months. Palestinian Prime Minister Mohammad Shtayyeh said this week it would pay full salaries once it received the tax money.
(Writing by Nidal Almughrabi; Editing by Jeffrey Heller)
It was thrust into the national spotlight when 33 people tragically lost their lives in last year’s deadly bushfires. But the NSW south coast holds another unenviable title – the suicide capital of NSW.
In a grim reminder of the mental health battle facing our state, the area from Bateman’s Bay to the Victorian border lost 68 people to suicide between 2015 and 2019.
This is compared to the 33 lives lost to the bushfires which ravaged the region from September 2019 through to January 2020.
Analysis of Australian Institute of Health and Welfare (AIHW) data reveals the south coast area has a suicide rate of 21.5 per 100,000 people – the highest rate in NSW and an increase on the previous year.
Taree, Inverell, Yass and the Clarence Valley are the next worst affected.
News Corp Australia this week launches Mental Health 360, bringing together mental health experts and those touched by it first-hand.
Panel experts include former Australian of the Year Professor Patrick McGorry, Sydney University’s Professor Ian Hickie, child psychiatrist Professor Jon Jureidini, Chris Turton who lost his son Dan to suicide, Kids Helpline CEO Tracy Adams, ccountry music star and Rural Adversity Mental Health Program ambassador Melinda Schneider and Federal Health Minster Greg Hunt.
Together with Sky News’ Peter Stefanovic and senior journalists Sue Dunlevy, Ben Pike, Natasha Bita and Kathy McCabe, Mental Health 360 dissect what is arguably the biggest issue impacting Australians.
“I think we are seeing in the coastal regions the cumulative effects of the bushfires, social dislocation and the consequent effects of further trauma through COVID-19,” Professor Hickie said.
“These are the areas where there are already economic impacts, disruption and now there are additional effects.
“It’s very similar to what’s happening on the north coast of NSW. We talk about this idea of stacked distress.”
In the direct aftermath of the 2019-20 bushfires, it has been estimated that more than half of Australian adults felt anxious or worried about the bushfires, according to a recent AIHW study.
To tackle the problem the Suicide Prevention Collaborative in the Illawarra Shoalhaven is providing classes in resilience and self help to students in year 9 as well as training members of the community in the skills they need to help in a mental health crisis.
They have established an after care program to follow up people after a suicide attempt and are ensuring they are connected to community mental health services.
Work is being done to better publicise where people can go for help and to start a community conversation around suicide.
The figures also reveal a yawning gap between suicide rates in the bush and Sydney – where the overwhelming majority of mental health professionals live.
Gosford and Wyong on the state’s Central Coast are the second and third-worst areas in the Greater Sydney region – behind the Sydney CBD.
Those Central Coast locations lost 222 people to suicide from 2015-19 with a suicide rate of between 12.99 and 13.73 per 100,000 residents.
“Gosford on the Central Coast has been known for a considerable period of time as having issues and has been the subject of particular inventions,” Prof Hickie said.
The inner city of Sydney has Sydney’s highest suicide rate, at 14.6 deaths per 100,000 people.
Yet there are 27 other rural and regional locations with a higher suicide rate.
Richmond and Windsor, Mount Druitt, the Inner West and Penrith are the other areas in Sydney most impacted by suicide.
Analysis of the AIHW data reveals all but one of the 20 deadliest postcodes for suicide are all in rural Queensland, Western Australian, the Northern Territory and Tasmania.
A significant problem has also been identified in major city centres, as well as at Surfers Paradise on the Gold Coast.
The sobering statistics come as the country struggles to recover from the economic fallout caused by COVID-19 pandemic.
Professor McGorry said the statistics “are so shocking – it’s like a war zone”.
“There’s more than 15,500 people who have died in that five year period. If the cause of death were something different – like drownings or car accidents – it would be in people’s faces and on the front page,” he said.
“But because of the taboo, and that it is not spoken about freely, it’s muffled conversation, tinged with shame still. Suicide is still a largely hidden death toll.
“Even though there are hot spots in some areas with twice the rate of others, it is the uniformity of suicide that has really struck me. Communities are losing dozens of people every five years.”
Suicide Prevention Australia CEO Neives Murray said “we can’t underestimate the impact that the events of COVID19 is having today and into the future”.
“COVID-19 has amplified the factors we know link with distress and suicide, including unemployment, housing insecurity and financial stress,” she said.
“Fortunately, recent suicide deaths data in NSW and Victoria show that in contrast to some of the predictions, we are not seeing a spike in suicide rates in 2020.
“This means that the protective measures put in place by Governments across Australia are having an impact. These include things like the NSW Government’s significant investment in scaling up mental health and suicide prevention services, the Victorian Government’s investment in post-crisis aftercare, coupled with the Commonwealth Government’s support for JobKeeper and JobSeeker.
“Of course, we can’t be complacent. The next months and years will be challenging and that’s why we will work closely with Government and our members to ensure we continue to strengthen the suicide prevention and mental health systems,” Ms Murray said.
January and February are the deadliest months for suicides, according to the AIHW, with the most common contributing factors to suicide including a history of self-harm, disruption of family by separation and divorce, relationship problems, the disappearance and death of a family member and legal problems.
Between 2017 and 2019 the contributing factors which saw significant increases included relationship problems, social exclusion and rejection and a family history of mental illness.
“In rural and regional areas unemployment rates are higher, there are more poor people and opportunities are less for employment and participation,” Prof Hickie said.
“There are also economies which are subject to more rapid changes in fortune whether that be natural events – such as floods and other natural disasters – or through the opening and closing of key industries.
“Young people, Indigenous people, people with very limited education and skills are over represented – all of which create a background higher intrinsic suicide rates in those communities.”
‘WE ALL NEED TO THINK WE MATTER’
As the first anniversary of the suicide of her much-loved husband Glen Hannah loomed in May, country music star Felicity Urquhart could feel herself struggling.
The mum of nine-year-old Tia and seven-year-old Ellie had courageously maintained a fierce determination to find her “happy” each day, to just keep “having a go” since her husband’s death. They were the lessons she seeks to instil in her daughters every day
But the anniversary, coupled with the isolation of the pandemic lockdown and demands of homeschooling, tested her resolve until Ellie surprised her with a unique proposition.
Inspired by the recent Mother’s Day, Ellie told her mum “on the day we lost daddy, we need to make that children’s day.”
She suggested they decorate their home on NSW’s Central Coast with balloons and streamers and the daughters should receive a present. The idea stopped Urquhart in her tracks and she immediately agreed.
“We thought about daddy, reflected on all the nice things about dad … that got me through the day; we celebrated the children and our future and it was healthy for us to do,” Urquhart told Mental Health 360.
Hannah’s tragic death last year was an unfathomable shock to Urquhart and the tightly knit country music community.
The well-respected musician and graphic designer was sought after for his myriad talents as a player, producer and artist and had a large circle of close mates.
In the months after her husband of 10 years took his life, Urquhart sought counsel from experts and friends, trying to understand why.
She was shocked when informed the Central Coast has one of Australia’s highest incidences of suicide.
“Glen was highly successful, he had income flowing in, no great debts, that again is why the shock was so great,” she said.
“If you look at a pie chart of depression, he was the perfect example, but I wasn’t looking at pie charts because my husband was saying ‘I’ve just got some fires to put out, I’m just busy’ and meanwhile I’d be saying ‘Don’t worry, I’ve got the family, I’ve got this, just do what you need to do.’
“I kept trying to get out of the way and he is meanwhile spiralling out of control.”
Urquhart says she’s a talker. She’s enjoyed a side hustle from her recording and performing career as a radio and television personality because she’s a good talker and listener.
On reflection, she believes shame prevented her high-achieving husband from talking about his mental illness.
“It’s a terrible feeling to suffer, that shame, not being able to tell the person you love the most, the closest friend in your life or a stranger, to not even be able to go into a room with someone you don’t know to open up (about) this fear of failure and shame,” she said.
“Reflecting on the great man that Glen was, he was such a high achiever and I think they are the ones particularly who just push themselves that much harder, their expectations on themselves are so great and at times they are their worst enemy.
“And the irony is that Glen was the kind of guy who would say to me ‘Babe, don’t take it so hard’ or ‘You’re doing a great job.’ He was the guy you would go to, to be reminded to lighten up and things aren’t that bad.
“And yet all along, those things were worrying him. And I didn’t see it.
“How do we unpack shame and get beyond that? I have come to accept that was a terrible pain that Glen suffered.”
Urquhart’s bravery is speaking openly about her husband’s suicide is fuelled by a determination to break the cycle of shame, to urge anyone who feels a “smidge of that” to have a conversation. For those in the arts community, she advocates reaching out to Support Act who have many resources to assist those in crisis, including a 24-hour wellbeing help line.
“Think of it as just having a conversation with someone that cares. People really care and value you and everybody matters,” she said.
“Everyone has their story. And we all need to understand that. We all need to think we matter.”
The ICRC said the Ethiopian Red Cross ambulances had taken “injured and deceased people” to the Ayder Referral Hospital.
On a visit to the hospital, ICRC staff found “80% of patients to be suffering from trauma injuries” adding that other services had to be suspended “so that limited staff and resources could be devoted to emergency medical care”.
“The hospital is running dangerously low on sutures, antibiotics, anticoagulants, painkillers, and even gloves,” ICRC head in Ethiopia Maria Soledad said.
The situation in Mekelle today is quiet and we hope that we will be able to get urgently needed assistance into the city soon. Red Cross ambulances have thus far been able to move around and transport injured and deceased. pic.twitter.com/07XxGYUnRf
The hospital is also running low on body bags for the deceased, the Geneva-based organisation said.
The ICRC, however, did not give any figures for the numbers injured or dead. Neither did it say whether the victims were civilians or military personnel.
What does the government say?
In a statement on Twitter on Saturday, Mr Abiy said the army was in full control of Mekelle and that this “marks the completion of the [military’s] last phase”.
“I am pleased to share that we have completed and ceased the military operations in the Tigray region,” he said.
He added that the army had released thousands of soldiers taken by the TPLF and was in control of the airport and regional offices, saying that the operation had been carried out with “due care for citizens”.
The prime minister has consistently described the TPLF leadership as a “criminal clique” and said that the police will “bring them to the court of law”.
How has the TPLF responded?
In a text message to Reuters, TPLF leader Debretsion Gebremichael did not directly comment on the situation on the ground, but said of the government forces: “Their brutality can only add [to] our resolve to fight these invaders to the last.”
He added: “This is about defending our right to self-determination.”
Mr Debretsion’s whereabouts are unknown.
A TPLF statement read out on regional Tigray TV said: “Fascistic bombings have caused civilian deaths and injuries. The Tigray government has vowed that it would take retaliatory actions against the barbaric bombings”.
Tigray TV and another station from the region were taken off air.
Analysts say the TPLF could now be preparing to return to the mountains to launch a guerrilla war against the federal government.
What are the humanitarian concerns?
The UN had warned of possible war crimes if the Ethiopian army attacked Mekelle.
It has also expressed concerns about the lack of access for humanitarian workers.
The Ethiopian authorities said on Thursday that “a humanitarian access route” overseen by the government would be opened, adding they were “committed to work with UN agencies… to protect civilians and those who need it”.
Also on Thursday, Ethiopian troops were deployed along Tigray’s border with Sudan, preventing people fleeing the violence from leaving the country, according to refugees.
In an update released on Saturday, the UN said that more than 40,000 Ethiopians had crossed over since the fighting began in early November.
Ethiopia’s state-appointed Human Rights Commission has accused a Tigrayan youth group of being behind a massacre this month in which it says more than 600 non-Tigrayan civilians in the town of Mai-Kadra were killed. The TPLF denied involvement.
In a meeting on Friday, Mr Abiy told African peace envoys that civilians would be protected.
Who are the TPLF?
The TPLF fighters, drawn mostly from a paramilitary unit and a well-drilled local militia, are thought to number about 250,000.
The organisation was founded in the 1970s and spearheaded the uprising against Marxist dictator Mengistu Haile Mariam, who was toppled in 1991.
It then went on to be the dominant political force in the country until Mr Abiy became prime minister in 2018.
Mr Debretsion has said the Tigray forces were “ready to die in defence of our right to administer our region”.
What is the fighting about?
The conflict is rooted in longstanding tension between Ethiopia’s government and the TPLF, sparked by Mr Abiy’s moves to sideline the party.
When Mr Abiy postponed a national election because of coronavirus in June, relations further deteriorated.
The TPLF said the government’s mandate to rule had expired, arguing that Mr Abiy had not been tested in a national election.
In September the party held its own election, which the government said was “illegal”.
In early November, TPLF fighters entered a military base in Mekelle which led to the start of the federal army’s operation in Tigray.
China wants to see more seniors contributing to its US$13 trillion dollar economy, as the world’s most populous country braces for the effects of a rapidly ageing population and shrinking workforce after more than three decades of the one-child policy.The Chinese government said this month it will launch specific policies to boost consumption and develop “human resources” among its senior citizens, including providing training to help pensioners integrate with the buzzing digital economy.In…
Think of the approach as “social cohesion,” Fogarty explained, as in having museums emphasize “building trust, understanding, and connection” that can be measured through their attitudes toward the museum’s offerings. The Oakland Museum, for instance, asks visitors to evaluate their experiences, answering questions like “Did you see yourself or your story reflected here?” and “Did you see other people’s stories and gain a new understanding?”
Given the fact that 80 percent of the museum’s visitors come from within a 50-mile radius, and that people of color make up more than half the museum’s annual audience, Fogarty’s goal to make the museum more welcoming has been easier to hit. Other museums face a steeper hill to climb: Thousands of miles to the southeast, in Jackson, Mississippi, the museum director Betsy Bradley of the Mississippi Museum of Art has also been implementing new strategies for cultural sensitivity, but the work has been challenging. The community her museum serves is unlike that of Fogarty’s, and sensitivity means more than just incorporating local voices and visitor input. “We have people in our community who have lived those experiences and carry in their bodies either vestiges of trauma or the incredible resilience that has been built,” she said. “And so for our museum, we are working to recognize that truth about an interpretation of a work of art is as valuable as the academic truth.”
There have been exhibitions, she told me, where preparation and putting community first would have been invaluable. In the spring of 2019, an exhibition featuring silhouettes, including those of enslaved people, offended Black staffers when the curators focused only on the artistic style and academic merits of the portraits, rather than acknowledging and exploring their history during a staff-only tour before the exhibit opened. Before that, Bradley green-lit an exhibition in the fall of 2017 about cotton called “White Gold,” by the artist Thomas Sayre, but she and her team didn’t consult with Black historians about how to frame the context of the piece until late in the process. They assumed it would be clear to visitors that the art wasn’t meant to celebrate cotton, but when she approached the NAACP, the Mississippi chapter’s then leader Derrick Johnson bristled at the idea. “He just looked me in the face and said, ‘But you’ve already decided you’re gonna do it,’” Bradley recalled. She conceded that the show moved forward anyway, but with the organization’s input the exhibition figured out a way to emphasize Sayre’s intentions to reflect cotton’s legacy, not honor the industry. “For a long time we thought that museums in general were in this academic safe space,” she explained, “that we can make decisions about content and about the integrity of that content as it relates to art history and artistic vision.”
Britain’s coronavirus recovery could be better than expected as households spend their pent-up savings having a good time like in “the Roaring Twenties”, experts have said.
Official forecasts that the pandemic may cost the UK three years of economic growth may be too gloomy, economists believe. Households have been saving during the crisis and the promise of a vaccine may allow life to return to normal faster than expected.
Torsten Bell, director of the Resolution Foundation think tank, said the UK had never before “gone through a crisis where household balance sheets have improved”. The massive increase in savings this year caused by restrictions on spending “is good news”.
He added: “History in the shape of the 1920s told us that when the [flu] pandemic came to an end — also the war — people were desperate to get out and have a good time. It’s called the Roaring Twenties for a reason”.
Asked if the Office for Budget Responsibility, whose forecasts warned that the economy will not return to 2019 levels until the end of 2022, had been too gloomy, Richard Hughes, its chairman, admitted it had been “under-optimistic about the pace of the recovery once the lockdown restrictions were lifted earlier this year”.
“Are pent-up savings going to fuel a recovery? We did see a bit of that after the first lockdown,” he added.
At the Institute for Fiscal Studies, Paul Johnson, the think tank’s director, said the economic scars left by the pandemic were “way less than the impact of the financial crisis”.
The OBR estimates that the economy will be 3 per cent smaller permanently. Its estimate of “scarring” was more optimistic than the 5 per cent of lost growth forecast by the International Monetary Fund but less than the 1.75 per cent projected by the Bank of England.
Under the OBR’s estimate of 3 per cent permanent damage, the government will need £27 billion of tax rises simply to stabilise debt at 100 per cent of GDP. Mr Johnson said the tax rises were more likely to be at least £40 billion as pressure for more NHS spending and extending universal credit were not included in the official figures.
Compared with previous austerity plans, “it’s not a vast quantity of money . . . it’s not great but it’s not terrifying,” he said.
The talk of a brighter outlook came as Boris Johnson last night told Tory MPs that he thought the Office for Budget Responsibility’s forecasts were too “gloomy”. He said he would wager that the combination of mass-testing and vaccines means the economy will recover faster.
Mr Hughes, the OBR chairman, said there was still “huge uncertainty” about vaccines: “I think over the course of the last year it is true we were under-optimistic about the pace of the recovery once the lockdown restrictions were lifted. Consumption did lift up quickly. Tax receipts surprised on the upside. But we didn’t forecast a second wave, the need for a second lockdown.
“This balance you have to strike between public health restrictions as a way of controlling the virus and economic performance is a really tricky one.
“There is still huge uncertainty about vaccines. We are getting more news every day about their effectiveness and what the evidence says. Compared to the IMF we are not as gloomy as they are about long-term scarring.”
Speaking at a Resolution Foundation event, he also questioned whether wealthier people will go out and spend the savings they have accrued during the lockdowns. He said “Is all this pent up savings going to fuel a recovery and consumption? We did see some of that when the first lockdown was lifted, when some people’s bank balances were quite healthy and they spent a lot on consumer durables.
“One big question is what is the marginal incentive to save going to be like in future. People having faced this big shock to their livelihoods, is that going to lead them to save more on average as a share of their income on the longer term. That is possible and if so that could be a further drag to the economy.”
Mr Hughes also said that there has been an “extraordinary expansion” of public spending. “What we’ve seen in the wake of coronavirus is an extraordinary expansion of spending. This was a bit like Beveridge overnight,” he said. “The extent to which the government is acting as an insurer of last resort is really quite extraordinary. The government has taken on its shoulders an enormous share of the burden of this shock.”