Spring Statement: Philip Hammond hails better debt and growth forecasts

0

Course playback is unsupported on your device

Chancellor Philip Hammond has open upgraded projections for growth and predicted falling inflation and borrowing in his Come up Statement.

He claimed the UK economy had reached a turning point and there was “unsubstantial at the end of the tunnel”.

He ruled out an immediate end to austerity but hinted at possible spending wakens in the future.

Labour accused him of “astounding complacency” in the face of the worst in any case public sector funding crisis.

The chancellor resisted calls from Labourers and some Tories to use the extra cash from an unexpected boost in tax sales receipts to ease the spending squeeze.

But he said he would “set an overall path for visible spending for 2020 and beyond” in his Autumn budget, with a detailed dish out review in 2019.

The raw figures

The chancellor told MPs growth was forecast to be 1.5% this year, up from 1.4% augur by the Office for Budget Responsibility in November, with the forecast for 2019 and 2020 unchanged at 1.3%.

In his 26 petty statement he also said debt would be falling as a share of GDP from 2018-19, which force be the start of “the first sustained fall in debt for 17 years, a say point in the nation’s recovery from the financial crisis of a decade ago”.

Mr Hammond mentioned MPs: “That’s the OBR’s forecast, Mr Speaker, but forecasts are there to be beaten.”

OBR chief Robert Chote said: “Blanket the referendum vote does seem to have weakened the economy as we and most other forecasters conjectured, but not quite as much as we forecast back in November 2016.

“Having said all this, we are quiet dealing with the very early drafts of economic history and it’s momentous not to put too much weight on what are still early indicators of economic project either side of the Brexit vote.”

He said the UK was borrowing less than anticipation this year thanks to more tax coming in from self-employed women – revenues are £2.9bn higher than predicted.

But he added: “We don’t expect much of that safe news to push forward into future years.”

Ahead of Mr Hammond’s report, the OECD said the UK economy will grow at a slower pace than any other principal advanced or emerging nation this year, as it raised its growth forewarn to 1.3% in 2018.

  • Reality Check: Is the chancellor right that debt is contract?
  • Why is chancellor so bullish about economy?

What about Brexit?

The OBR has purposeful that the UK will continue to pay contributions into the EU budget until 2064 – 45 years after the ceremonious date of Brexit – with the total “withdrawal bill” amounting to £37.1bn. The particular reason for this is that the government will have an on-going obstacle for a proportion of EU staff’s pensions earned while the UK was a member.

Mr Hammond did not make much to say about Brexit in his statement – prompting opposition claims that he remembered there would be no “Brexit dividend” for the UK economy.

Mr Hammond said: “Our conservation does still face uncertainty as we go through the negotiation process with the European Congruity.”

But he added that business confidence would improve as the government saved “greater clarity” about its Brexit plans, adding: “We beat the prognosticate in 2017, let’s beat it again in 2018.”

  • Reality Check: Brexit cash allocated to sections

More money for the NHS?

Media playback is unsupported on your device

Philip Hammond released the clearest hint yet that he is prepared to increase spending on health, in an evaluation with BBC Political Editor Laura Kuenssberg.

The chancellor said he recognises the lean ons for more spending in the NHS, local government “and other areas” and he hoped the progress in the public finances “hinted” at by the OBR would allow him to increase spending in his Autumn budget.

He acknowledged a “persistent upward pressure” on NHS spending because of an ageing population and developments in sorrow.

What else was announced?

Mr Hammond did not use his Spring Statement as a “mini-Budget” as in preceding years, and instead unveiled a series of consultations on future policies, numbering:

  • A reduction in tax on for the least polluting vans to “help the great British immaculate van driver go green”
  • A possible tax on single use plastic
  • A new ‘tech tax’ looking at how firms delight in Google and Facebook are taxed
  • A call for evidence “on whether the use of non-agricultural red diesel tax assuagement contributes to poor air quality in urban areas”
  • The future of cash and digital payments, which could course the end for 1p and 2p coins

He also said the next revaluation for business rates is being ousted forward to 2021, after which the government will move to revaluations every three years and there last wishes as be an additional £1.7bn to deliver 26,000 affordable homes in London.

The elocutions in full

Media playback is unsupported on your device

Media playback is unsupported on your legend pleasure

What the opposition made of it

Labour’s shadow chancellor John McDonnell claimed: “Does the chancellor really believe the NHS can wait another eight months for the lifesaving capitalizes it needs? How many people have to die waiting in an ambulance before he mandates?”

Mr McDonnell also raised concerns over funding for schools, the crisis services and local councils.

He said “austerity was a political choice not an profitable necessity”, adding: “We were never all in this together as they stated.”

The SNP’s leader at Westminster, Ian Blackford, said: “The light at the end of the tunnel is a hard Brexit, which is universal to cost jobs and prosperity in the this country.”

Lib Dem leader Sir Vince Radiogram said “Brexit was dragging the economy down” and the chancellor had been goodness not to turn on the public spending taps because there was still “to a great extent little freedom” in the public finances.

Green Party co-leader Caroline Lucas tweeted: “Tories consecrate a tiny improvement in growth in today’s #SpringStatement, but GDP isn’t a real measure of our high society. True indicators are people being treated in hospital corridors & foodbank use fill up. Our economy is designed to fail people – and it needs an overhaul.”

And finally…

Mr Hammond accused Labour pains of talking the economy down, comparing them to the gloomy character from Winnie the Pooh he has himself been equated to in the past.

“If there are any Eeyores in the chamber they are over there. I for now am at my most positively Tiggerlike today, as I contemplate a country which faces the days with unique strengths.”

Labour’s shadow communities secretary Andrew Gwynne teased on Twitter that Mr Hammond was “talking Pooh”.

Leave a Reply

Your email address will not be published. Required fields are marked *