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U.K. Set for Big Reopening as Cases Soar Most in the World

·5 min read
U.K. Set for Big Reopening as Cases Soar Most in the World

(Bloomberg) --

Boris Johnson’s plan to get the U.K. back to normal is at risk of being derailed amid a public outcry over his attempt to dodge pandemic isolation rules, as Covid-19 cases soar the most in the world.

Coronavirus restrictions expired in England on Monday, a moment that was meant to herald the full reopening of an economy battered by its deepest recession in 300 years.

But the lifting of curbs came against a fraught backdrop of surging infections and political strife for Johnson. The U.K. added more than 54,000 new cases Saturday, and over 47,600 on Sunday, more than Indonesia, the current pandemic epicenter, according to data compiled by Johns Hopkins University.

The surge in cases weighed on the pound, which fell as much as 0.4% to $1.3707, the lowest since mid-April. Meanwhile, demand for safety boosted U.K. government bonds, with 10-year gilt yields falling two and a half basis points to 0.60%.

The prime minister, meanwhile, is fighting to regain his credibility after a furious backlash forced him and finance minister Rishi Sunak to abandon an initial attempt to avoid their own government’s isolation rules. The pair were told they needed to stay home after meeting Health Secretary Sajid Javid, who tested positive for Covid-19.

The furore — overshadowing what U.K. media have called “Freedom Day” — is a deep irony for Johnson. It graphically demonstrates the perils the premier faces as he tries to break the U.K.’s cycle of lockdowns and revive economic activity while ensuring state-run hospitals are not overwhelmed.

London Is Open Again. Here’s What You’ll Find If You Head In

The 10-day isolation rule for close contacts of Covid patients has caused disruption across England, leaving public transport and other companies struggling to cope with staff shortages.

Johnson and Sunak had both been contacted by the National Health Service and told to stay home but announced Sunday morning that they would take part in a trial program allowing them to take regular tests instead, while continuing to go to work and carry out essential government business.

The decision sparked an immediate storm on social media and within three hours the pair had reversed course. In a video message, Johnson tried to explain.

The U-Turn

“We did look briefly at the idea of us taking part in the pilot scheme which allows people to test daily, but I think it’s far more important that everybody sticks to the same rules and that’s why I’m going to be self-isolating until Monday 26th July,” Johnson said.

But by then the damage was done, with most U.K. newspapers leading on the premier’s U-turn.

The question now is whether the public will continue to listen to government guidance on how to act responsibly with infection rates still high and the summer luring many on long-awaited holidays.

Laws requiring people in England to wear face masks on trains and sit at socially distanced tables in bars and restaurants have expired, with crowds packing into nightclubs, which were able to reopen for the first time at midnight. Most restrictions have also been lifted in Scotland, though face masks remain compulsory in indoor public spaces.

Face Mask Row Isolates Johnson as U.K. Covid Strategy Fractures

Doubts remain over how keen the public will be to make use of all the freedoms as the delta variant sweeps across the U.K. A poll for YouGov Plc on Friday showed 60% of Britons are feeling increasingly nervous about the curbs lifting.

Neil Ferguson, an epidemiologist from Imperial College London whose modeling was key to the first lockdown, told the BBC on Sunday: “I think 100,000 cases a day is almost inevitable.” Javid himself gave a similar figure earlier in July.

The inconvenience and fresh economic damage created by the NHS’s test and trace system, designed to slow the virus’s spread, has infuriated businesses.

The system has created acute worker shortages across industries ranging from retail stories to car factories, and there have been reports the app is over-zealous and can even identify neighbors as contacts through house walls.

According to the Adam Smith Institute, 1.73 million people are currently isolating after being contacted by the app to say they’ve been in contact with a positive Covid case. That figure could rise to 5.2 million people by mid-August, the research group said. While cases are surging, the U.K.’s death toll remains relatively low thanks to vaccination. Just 25 Covid fatalities were reported Sunday, compared with more than 1,000 in Indonesia, and 137 in the U.S., according to the latest available data.

Road Trip

The political risk for Johnson also reflected criticism that his officials often haven’t followed the rules that they set for the rest of the country. Examples include a lengthy road-trip then-adviser Dominic Cummings made at the height of the pandemic’s first wave, and former Health Secretary Matt Hancock getting caught kissing an aide.

Sunak acknowledged those concerns in a tweet, saying that “I recognize that even the sense that the rules aren’t the same for everyone is wrong.”

Johnson in his video urged the country to “please, please, please be cautious,” and in remarks released by his office asked younger adults to come forward for their vaccines.

A decision on whether to vaccinate under-18s is due in the next few days. The spread of the delta variant has pushed the U.K. infection rates toward records. Hospitalizations are at the highest since late March, although they’ve risen at a slower pace than new infections.

The weakened link between rising cases and severe illness has been one of the government’s justifications for lifting restrictions, even though many scientists and other critics say the move is coming too soon.

“I’ve said consistently that lifting all restrictions in one go is a mistake, it’s reckless,” opposition Labour leader Keir Starmer said in a statement.

(Updates with market reaction in fourth paragraph)

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