This research, undertaken by researchers at the Bank of England, used data made available via the Office for National Statistics (ONS)Secure Research Service (SRS), which is being expanded and improved with ADR UK funding.
Analysis by the Bank of England, including data accessed in the SRS, supported HM Treasury decisions on the Coronavirus business support via Bounce Back loans and the Coronavirus Business Interruption Loan Scheme. Eligibility for the schemes was informed by the Bank’s analysis.
The Covid-19 outbreak early in 2020 quickly escalated into a national emergency. In order to respond efficiently to this unprecedented crisis, staff across the Bank of England quickly started acquiring new data sources to build a fuller picture of the challenges businesses were facing. Working from the ground up, staff were able to assess how turnover and costs might evolve in different scenarios. To supplement this, staff used information form the Business Structure Database to better understand the impact on small businesses, which together make up a large fraction of employment and turnover for the UK.
The analysis was published as the Financial Stability Report (December 2020) which primarily set out a view of the performance of the financial system through Covid-19 related disruption and outlook for the UK financial stability, including an assessment of the resilience of the UK financial system.
Analysis and interpretation were discussed across government departments and institutions such as the Office for National Statistics. Invaluable detailed discussions with staff across the public and private landscape helped to shape and refine the final outputs.
There are two key contributions from the work undertaken:
- Firstly, the Report was crucial for the Financial Policy Committee (FPC) to deliver its primary objective of contributing to financial stability during the Covid-19 crisis.
- Secondly, the more unusual contribution was the indirect impact much of the work had on many of the support schemes delivered by the Government, from the Covid Corporate Financing Facility (CCFF) for larger firms, through to the Coronavirus Business Interruption Scheme (CBILS) for smaller firms and Bounce Back Loans (BBL) for the very smallest.
Existing relationships between ONS and Bank of England researchers facilitated the use of these data within a matter of hours and ensured the Government could deliver carefully targeted support where it was most needed.
Researcher Dr Fergus Cumming said:“Access to secure data through the ONS Secure Research Service is enabling critical analysis to support a variety of Covid-19 policy decisions. Analysis of this data aids HM Treasury in the design of Covid-19 support schemes for businesses and the self-employed.
“The ONS response to Covid-19 allowing out of the office access to the SRS has also been of fundamental importance in supporting research supporting policy decisions. The commitment by the SRS team to go above and beyond has been critical in empowering us to continue to deliver to our stakeholders in a timely fashion.”
Read the Financial Stability Report (December 2020).