Swine flu to affect UK growth

As the NHS plans for as many as 65,000 deaths from swine flu this winter, a major body has issued a stark warning over the effects of the illness on the UK economy. According to Chief Medical Officer Sir Lim Donaldson the mortality rate from the pandemic could be up to 10 times the normal level, with 30 per cent of the country's population developing symptoms. In the wake of this jump Oxford Economics has said in a report that UK GDP could fall by five per cent, pushing the economy towards deflation and putting off recovery for as long as two years.

Spending patterns would be affected by high levels of swine flu, the institute says, with consumers staying away from restaurants and shopping centres which might harbour infection. "In addition", it says, "heightened uncertainty about economic developments is likely to make businesses postpone investment. Increased uncertainty would also have a negative impact on financial markets, bringing lower share prices and higher market interest rates than warranted by the economic situation."

Not all the economy will suffer equally however, chemists like private equity-owned Alliance Boots are benefitting from the disease's spread as consumers pick up treatments and pharmaceutical manufacturers Roche and GlaxoSmithKline are also doing well out of widescale purchasing of antiviral drugs.

WHAT THEY ARE SAYING:A spokesman for the Forum for Private Business, in the Guardian: "It is imperative that firms plan ahead now, to get ready for the impact this could have. If you are one of the smallest firms you must plan to make sure people get paid and invoices get paid. It is essential to form project teams as soon as possible and make sure you comply with the law." ·