Vaccine passports to new variants: the big reopening questions

The Government has updated its figures on vaccine supply, promising a ramping up this month and next. But the reopening plan for the economy and businesses is still surrounded by big questions. Here are the key ones.

1. When will reopening start in earnest?

The potential timeline is starting to become clearer. If the Government vaccination targets are met, particularly promises to increase delivery massively going into May and June, then there is a prospect of a gradual reopening from May onwards.

This would see a phased reopening of retail in May, starting with click and collect and outdoor locations like garden centres and moving on to a fuller reopening. Hospitality might then reopen in June.

The UK is around six weeks ahead of us in terms of delivering vaccinations and shops, hairdressers, gyms and beer gardens are opening in England from next Monday. If we follow the same pattern, we will get to the same point in late May.

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This would also tally with data in Israel, which suggests that getting 40 per cent to 50 per cent of the population fully vaccinated can lead to a sustained fall in numbers as reopening commences.

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We should be around that level at the end of May. By then the most vulnerable should be fully vaccinated. The dangers are the obvious ones – a delayed roll-out, a spike in numbers before reopening happens among those still waiting for a vaccine, or trouble with new variants.

2. What about the staycation season?

If hotels are to be open for the summer – from say mid-June – then both the vaccine and virus numbers need to stay on track. England and Scotland are opening indoor hospitality and hotels on May 17th.

The Irish – and EU – programmes may not be quite as far behind at that stage as we are now, but a similar phased reopening would push hotels and hospitality here into June.

The UK will open self-catering accommodation earlier. Could we do the same? By the end of June, the target here is to have 80 per cent of the population vaccinated once and 55 to 60 per cent twice. The numbers of expected vaccinations would allow this to happen – just about. This should allow a summer season – but the timing is tight and there may well be bumps in the road.

3. What about sectors like wet pubs, event and travel?

The outlook here remains clouded. There is talk of the greater use of testing or vaccine passports to help reopen events, allow people to travel, or even gain access to pubs.

The UK is planning to experiment with some larger crowds at events and plans are being examined across Europe to use vaccine passports or certificate to start to open up travel. With plans to tighten up travel from many EU countries to try to control the arrival of variants, this still looks some way off.

The issue of vaccine passports looks set to be controversial in the setting of the domestic economy. There are suggestions, for example, that people who are fully vaccinated might be allowed to visit hairdressers or restaurants while non-vaccinated might be told not to. This would allow some businesses to reopen – but would the staff then be open to risk? Perhaps a quick testing regime could ensure all staff are Covid free?

But could such a scheme work practically and legally?

Denmark and Sweden – and Israel – are all using or planning to use some kind of local vaccine certification to help reopen their consumer facing sectors. Rapid testing may also be a route to reopening – in Tubingen in Germany a negative test allows a day pass to shop and get your hair cut.

4. What about workplaces?

Employers generally cannot insist that their staff are vaccinated or ask them whether they are – though in high risk areas like hospitals and nursing homes this may be possible. Some workplaces are already using rapid antigen and other tests, some on a compulsory and some on a voluntary basis and Government policy looks set to support wider use.

Many companies already are insisting on testing in the workplace, according Jennifer Cashman, employment law partner at RDJ solicitors. It does raise data protection issues, so companies should have a data privacy assessment carried out and proper health and safety policies, all to establish that testing is a reasonable and proportionate measure.

Many companies have introduced the regime on foot of demand from the workforce, she said. Depending on vaccine coverage and protection, this could be a tool to a wider reopening of many workplaces and universities in the autumn.

5. Can companies afford to open?

Many SMEs in particular are facing significant financial distress and have only remained open due to Government supports. A Central Bank study this week showed that two thirds of SMEs had reported falling turnover last year and most made losses.

One in six were in financial distress at the end of the year – and this will have risen due to the prolonged post Christmas lockdown.

When will we be comfortable squeezing into a pub?

Accommodation and hospitality companies were in many cases in deep financial distress. These shows that many SMEs are on the edge, even when counting in Government supports. Without the support the figure would have been much higher.

Reopening will be difficult and will require ongoing support from Government. Ministers Paschal Donohoe and Michael McGrath have said there will be no "cliff-edge" withdrawal of supports – but supports will wind down at some stage and how to help companies to reopen is a really difficult policy question.

6. How can we be certain of reopening?

We can’t. And this is one of the difficulties for the Government in setting out timetables. News on the vaccines is very positive – looking both at trials and at experience in countries like the UK and Israel. This is fuelling hoped of a steady reopening in May and June.

Taking a more pessimistic view, economists Olivier Blanchard and Jean Pisani-Ferry, writing for the Peterson Institute, wrote recently of three potential costs of a prolonged problem – perhaps caused by new variants. They see three economic consequences: lockdowns coming and going in waves, ongoing border controls and enduring effects on both supply and demand in the economy.

The latter point is one to watch. We know, as outlined above, that many firms will struggle to reopen, affecting supply in the economy. But how will demand be affected in the years ahead?

Will people be nervous of travelling – or queue up at the departure gates at the first opportunity? How many will return full time to offices, thus affecting demand in city centres? When will we be comfortable squeezing into a pub? How much of shopping has gone permanently online?

These are vital questions affecting thousands of businesses – and we just don’t know the answers.