Companies and workers reveal the impact of the response to Covid-19

Workers and business leaders have spoken at the Covid-19 inquiry about the devastation they faced during the pandemic and the difficulties they faced accessing support.

Business owners described breaking down in tears when they were forced to lay off staff or close the store entirely, while employees told how they feared for their jobs.

Comments were included in 8,000 submissions from the public and come since the third stage of the investigation focuses on the measures taken to support workers’ incomes and keep companies afloat when the pandemic occurred.

According to the Treasury, £140bn was spent supporting businesses, with much of this going to paying people’s wages when they were forced to stay at home.

The inquiry heard how, on his first day as chancellor in 2020, Rishi Sunak was given a briefing on the impact of the Covid outbreak on growth and financial stability.

Two months later, the Treasury concluded that the economy was “in hibernation”, with output falling the steepest in almost 100 years.

Sunak is one of those who will appear before the inquiry, with Bank of England Governor Andrew Bailey also giving evidence in the coming weeks.

Monday’s session began with emotional video testimonies from business owners and self-employed workers whose livelihoods were affected when Covid lockdowns began.

In the video, Lowri, a freelance events professional, explained how she had become desperate when her income stopped and her freelance work disappeared. She fought back tears as she explained that she didn’t qualify for support. She had a mortgage and a child at home, with no “savings” to back her up.

Last week, the report on the second phase of the inquiry, into political decision-making, concluded that the government had done “too little, too late”.

The current module, which is expected to last until just before Christmas, will examine the unprecedented economic intervention implemented when the first lockdown was announced in March 2020.

The largest scheme, the Coronavirus Job Retention Scheme, known as furlough, covered 11.7 million jobs between March 2020 and September 2021, at a cost of £70 billion.

It paid a portion of employees’ salaries to ensure they continued to have income even if they couldn’t go to work, and to keep businesses running so they could reopen later.

There was also a support scheme for the self-employed, business loan schemes and business rates relief.

Questions were raised about the extent of financial support, the strength of safeguards against fraud and error and whether it delayed people taking on new job roles.

In submissions to the inquiry, employees told how they were worried about losing their jobs and were facing a struggle to pay bills during the pandemic, with some left without furlough payments after being made redundant.

However, others said their careers were rescued by the furlough scheme, while some business owners said they were saved by government support schemes and spared having to make redundancies.

As part of the submissions, the owner of a small retailer told the inquiry: “One terrible day I had to call 80% of my staff and tell them we had to make them redundant because there was no more work for them.

“And I cried, I didn’t sleep all night, I was very, very upset. I had people who had worked for me for seven or eight years, who I had to say, ‘I’m so sorry, I literally can’t pay you any more because we don’t have any business.'”

Describing flaws in the furlough system, one Northern Irish taxpayer said her husband lost his job in the period before the scheme came to an end. “Then it spread, but he had already been fired,” he said.

The Eat Out to Help Out scheme, introduced by Sunak, divided opinion among bosses.

“When we reopened it helped bring people back to the pub and helped us increase our profits,” said the finance director of a large English food and drink company.

But an operations manager at a travel and hospitality company in Wales said: “When we look back, it probably wasn’t the right thing to do, given where we were at with the pandemic.”

The Covid Inquiry, chaired by Baroness Hallett, is expected to look at 10 areas in total and provide lessons for managing future pandemics.

This phase of the inquiry will also look at additional funding provided to public services such as railways to keep them running during lockdowns, and support for the voluntary and community sector.

It will examine decisions on benefits, sickness benefits and support for vulnerable people.

Also appearing before the investigation:

• Former Treasury officials James Benford and Dan York-Smith
• Representatives from charities Child Poverty Action Group, Long Covid Support and Disability UK
• Ben Warner, former Downing Street special adviser
• Former Covid-19 Taskforce analysis director general Robert Harrison.

Last week, Sunak told the BBC that the government and scientific community were “operating in a very uncertain environment”.

“I think we need to look at decisions made through that lens.

“But it is important that the lessons [are] “We learned so we can be better prepared if there is ever another pandemic.”