June 14, 2020 / 10:52 AM / 20 days ago

UPDATE 3-Britain reviews distancing rule for next stage of easing lockdown

* UK looking at changes to 2-metre social distance rule

* Travel quarantine changes under consideration

* Hospitality sector might reopen in early July

* Too early to cut VAT tax (Releads, adds quotes from PM Johnson)

By Paul Sandle and William Schomberg

LONDON, June 14 (Reuters) - Britain is reviewing its two-metre social distancing rule ahead of the next stage of lockdown easing planned for July 4, when bars, restaurants and hairdressers could reopen in England, Prime Minister Boris Johnson said on Sunday.

Progress in tackling the coronavirus pandemic had created "room for manoeuvre" on the rule, which many employers have said will make it harder to get back up to speed, Johnson said at an east London shopping centre preparing to reopen next week.

Britain has reported the third highest number of coronavirus deaths after the United States and Brazil, something critics of the government say reflects its response to the crisis.

Johnson's Conservative Party government, which says it has followed scientific advice in its handling of the pandemic, faces the difficult balancing act of reviving the economy without allowing a second wave of cases.

"We'll work closely with the scientists at all times and make the right decision on the basis of safety, health and stopping the disease," Johnson said.

The scale of Britain's slump was laid bare by data last week which showed output shrank by 25% over March and April.

As COVID-19 in the population fell to 1 in 1,600 or lower, the chances of catching the disease from an encounter of less than two metres had diminished, Johnson added.

"You start to build some more margin for manoeuvre," he said. "So we'll be keeping it under review for July 4th."

Finance Minister Rishi Sunak earlier told Sky News the review would involve economists as well as scientists so it could be looked at "in the round".

Lowering the distance people have to maintain from one another could provide an immediate benefit for badly-hit English pubs, with Sunak saying three quarters could reopen, rather than about one third with a two-metre rule.

Airlines have also warned of huge job losses because of the quarantine policy Britain introduced last week.

Sunak said the government could make changes to the 14-day quarantine for people coming into the country, such as the introduction of travel corridors with specific countries.

"The transport secretary is actively looking at options as we continue to make progress against the virus. We might be able to do more here as well," Sunak said.

Asked if he might cut value-added tax to spur spending, Sunak said it was something Britain had done previously.

"Before we have that conversation we need to actually reopen those sectors. There's no point in cutting VAT on a sector that is actually closed," he said. (Reporting by William Schomberg and Paul Sandle Editing by Alexander Smith)

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