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* TALKING POINT, BY VICTORIA HEWSON
* NEW YEAR, NEW LOCKDOWN
* IN THE MEDIA
* WE'RE HIRING!
* YOU'RE INVITED

Happy New Year to all our readers!

An unfestive Christmas break was at least enlivened (for those of us who are that way inclined) by the news and then publication of the Trade and Cooperation Agreement (TCA) between the UK and the EU. If one can't go to the pub and see friends on Christmas Eve, what could be better than watching back to back press conferences with Ursula von der Leyen and Boris Johnson?

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After combing through the deal, I concluded that it represents a broadly positive outcome for both sides. No tariffs or quotas on goods (subject to meeting rules of origin) should never have been in doubt. The issue that had dogged the negotiations, and seemed at some points likely to result in the transition period ending with no free trade agreement in place, was the EU's insistence that the absence of tariff barriers should be based on a 'level playing field', so that the UK could not undercut EU businesses by cutting regulation on workers' rights and the environment or granting distortive state aid.

A pity that neither side seemed to accept that state aid is mainly bad for the economy of the country that issues it, although, as I noted in this piece in CapX ([link removed]) , Boris Johnson does seem to recognise the value of regulatory competition. I also discussed the deal on Times Radio with IEA trustee Professor Patrick Minford, who is also pretty optimistic about our prospects under the TCA.

Looking ahead, the new arrangements for Northern Ireland are going to continue to cause problems. The implementation of the Northern Ireland Protocol to the Withdrawal Agreement seems likely to cause ongoing headaches for UK and EU authorities and, more importantly, for Northern Irish businesses and consumers in 2021. More positively, the TCA will enable the UK to pursue free trade with other partners, for example by joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

But as I noted in the Daily Express ([link removed]) , it's important that we don't wait for free trade agreements to start rolling back tariffs and reforming regulations – unilateral action to benefit consumers and businesses will be vital as we strive to restore growth and prosperity when we emerge from lockdowns.

Victoria Hewson
Head of Regulatory Affairs, Institute of Economic Affairs
NEW YEAR, NEW LOCKDOWN

New Year celebrations may have been dampened by the announcement of Lockdown 3.0, but with the approval of the Oxford-AstraZeneca vaccine and plans for two million doses per week, there is a glimmer of light at the end of the tunnel.

But what might these new restrictions mean for our beleaguered economy?

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According to IEA Economics Fellow Julian Jessop, the new UK-wide lockdown "may cost 10 per cent of GDP, or about £18bn every month" ([link removed]) . However, on balance, Julian argued that this could be "a price worth paying" to prevent tens of thousands of premature deaths and other harms if the NHS becomes overwhelmed with Covid patients.

Julian added that with an exit from the pandemic on the horizon, both households and businesses can look forward to "a brighter spring". His comments were featured across the media, including The Sun ([link removed]) , Reuters UK ([link removed]) , City AM, The Times ([link removed]) and Times Radio.

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Julian also took part in an IEA panel discussion examining what we can expect from 2021, alongside IEA Head of Lifestyle Economics Christopher Snowdon, Head of Regulatory Affairs Victoria Hewson and Head of Media Emily Carver.

While Julian remained optimistic that economic activity will return to pre-Covid levels by the end of this year, Christopher argued that the economy and labour market could face real difficulties. Victoria predicted that we may be heading towards a K-shaped recovery, where some sectors of the economy, for example tech, do very well, but others struggle.

The panel gave their top predictions for 2021, including the opportunities and challenges economic liberals may face in the coming year and who they think might come out as the big winners. You can watch the video here ([link removed]) or listen to the podcast here ([link removed]) .
IN THE MEDIA

While the UK may have been the first to secure and approve a Covid-19 vaccine, the government has come under fire for what some perceive to be a "lethargic" approach to its rollout. According to the latest data, the UK now lags behind Israel, the United States and Denmark in terms of vaccination doses administered per 1,000 people.

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IEA Editorial and Research Fellow Professor Len Shackleton argued in an article for CapX ([link removed]) that the twin problems of NHS staff shortages and slow rollout highlight the pressing need to reform occupational licensing.

And it's not only medicine where these rules present problems – the “profusion of licensing” makes it much more difficult and expensive to enter many occupations. The need to liberalise these rules, Len argues, is all the more urgent in the current economic climate, given career prospects for both the young and old are bleak.

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In an opinion piece for The Sunday Telegraph ([link removed]) , IEA Director General Mark Littlewood outlined three things Britain can do to truly thrive following our departure from the EU. This could include the removal of those EU laws that were opposed by the UK, but enforced through the process of qualified majority voting; a "culture shift" in how we approach regulation; and "doubling down" on what we're doing well, including granting the International Trade Secretary Liz Truss free rein to oversee the UK's accession to the transpacific trading bloc and cut a meaningful deal with the US.

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Mark also took part in a podcast with Danish free market think tank CEPOS, in conversation with its President Martin Ågerup. They discussed Brexit, with Mark sharing his views on how Britain can make the most of the opportunities the UK's departure from the EU might present. You can watch here ([link removed]) .

IEA Fellow Professor Philip Booth appeared on BBC Radio 4's You and Yours programme to discuss the state of the social care system. Philip argued that we should reform the tax system to take pressure off those who wish to care for family members but simply cannot afford to do so because of the penal rates of taxation we levy on single-earner families on relatively low incomes. You can listen back here ([link removed]) from 33:00 or listen to a short clip here ([link removed]) .

And with schools facing prolonged closures, IEA Director of Communications Annabel Denham argued in an article for City AM ([link removed]) that teaching unions have put the needs of members above those of pupils by failing to explore innovative routes to continuing education. Annabel also appeared on talkRADIO to discuss the impact of a third national lockdown on the UK economy.

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Meanwhile, in an article for Reaction ([link removed]) , IEA Head of Political Economy Dr Kristian Niemietz challenged the "woke" narrative that the crimes of the colonial era are "capitalism's original sin". Kristian argued that one cannot sensibly use the empire as a stick to beat capitalism with – it was "a costly prestige project that governments pursued for non-economic reasons".
WE'RE HIRING!

We are currently looking for a new Operations Officer to support the Operations & Technology Manager with a wide range of responsibilities, including event coordination, office maintenance, programme management, and departmental support.

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If you are interested or know someone who might be please do get in touch. You can find out more, and apply, by clicking here ([link removed]) .

We also offer several internship positions throughout the year; you can find out more about them here ([link removed]) .
MAKE THE (NEW YEAR) BREAKTHROUGH!

It's the new year – and what better way to kick off 2021 than by entering our Richard Koch Breakthrough Prize essay competition?

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This year we are seeking ideas to boost 'left-behind' towns and communities. There’s a first prize of £50,000 for the winning response to this question:

In the current severe economic climate, what pro-market, pro-enterprise policy would be the best way of supercharging growth, employment and living standards in 'left behind' Britain?

Why not seize the day? You can find out all the details at breakthroughprize.org.uk.
COMING UP

* In Conversation with Douglas Carswell
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On Tuesday 12th January at 6pm, the IEA will be hosting Douglas Carswell, chaired by IEA Director General Mark Littlewood.

Douglas previously served as the Member of Parliament for Clacton, where he gained a reputation as one of the country’s most outspoken and independently-minded politicians. Douglas was Co-founder of the Vote Leave campaigning organisation that supported a Leave vote in the 2016 Referendum. More recently, Douglas has established the Good Governance Project, which seeks to improve the way the UK is governed. He is the author of several influential books and papers, and was recently appointed as President and CEO of the Mississippi Center for Public Policy.

The event will be live streamed on our YouTube channel here ([link removed]) .

The IEA will be hosting the Rt Hon Baroness Morgan of Cotes and the Rt Hon Jacob Rees-Mogg MP later this month. Find out more here ([link removed]) .

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