UK government spending £372bn on Covid pandemic, says National Audit Office

Government spending on measures to cope with the coronavirus pandemic has risen to at least £372bn, according to the National Audit Office.

The independent public spending watchdog said the cost of Covid to taxpayers increased by more than £100bn since its last report in January this year.

The figure includes more than £150bn in grants for businesses – such as the Coronavirus Job Retention Scheme and the Bounce Back Loan scheme – around £97bn for health and social care – including the Test and Trace service – and just shy of £65bn for other public services and emergency responses.

The bill for supporting individuals affected by Covid, such as the Self Employment Support Scheme, was estimated at around £55bn, the NAO said.

Other expenditures from across Whitehall departments included around £12bn on emergency measures for the railways, which have seen passenger numbers plummet, a £619m contribution to the global Covax vaccine programme, and close to £1bn on the Covid-19 education catch-up fund.

The NAO said £172bn had already been spent, and the total figure included £26bn worth of guaranteed loans which are expected to be written off.

The total estimated bill provided by the NAO is for “lifetime costs” of projects linked to the pandemic, meaning that while £372bn has been earmarked for the various schemes, not all of it has yet been spent.

Chairwoman of the Public Accounts Committee (PAC), Labour’s Meg Hillier added: “Government expects to spend an eye-watering £372bn in response to the pandemic, and public accountability has never been more important.

”The NAO's cost-tracker tool is vital as the primary public data source on Covid spending across government.

“With such huge sums going out the door, and [the] government guaranteeing loans worth over £90bn, [the] government faces a long road to recovery ahead.”

The government faced criticism earlier this year after a report by the PAC found the test and trace system had swallowed up “unimaginable” amounts of taxpayers’ money with no evidence of any measurable difference on the course of the pandemic.

The report said NHS test and trace must “wean itself off” its reliance on private-sector consultants, after figures showed it was still employing around 2,500 in early February on an estimated daily rate of £1,100 a head – with the highest-paid individual costing taxpayers £6,624 a day.

And the PAC said that despite its £23bn budget in its first year of operation, test and trace failed in its task of preventing the second and third lockdowns.

The NAO figure does not include lost economic output. A UN report last year said the global economy was expected to contract by nearly $8.5 trillion (£6 trillion) over a two-year period due to the pandemic – the sharpest fall since the Great Depression in the 1930s.