Spring Budget: Economic overview transcript - Andrew Sentance

The economic forecast presented to the Chancellor by The Office for Budget Responsibility were fairly similar to what he received in the Autumn Statement, though the impact of Brexit has been pushed out. 

But actually when we look at those growth forecasts the economy is going to be growing on average by about 1.8%over the next 4 years very similar to the growth rate we saw in 2016. So if anything they may be a little bit optimistic. 

The borrowing numbers have come down and the Chancellor had, he had over the next 4 years about 35 billion pounds extra to play with but he chose to do very little with it, this was a safety first Budget from a cautious chancellor.  He put a little bit of extra money into spending in priority areas like social care and training, that totalled about 6 billion pounds over the 4 or 5 years ahead. 

But essentially he’s keeping his powder dry for a number of things, one is he’s keeping his powder dry for Brexit, secondly he probably wants to make a bigger show of his Autumn Budget which will be the first Autumn Budget later this year.  And thirdly he’s going to be thinking about the 2020 election, so there’s going to be perhaps more scope for tax give aways in a few years time. 

The biggest measure for business was some additional business rate relief but that was only equivalent to around just under half a billion pounds, and from the personal sector point of view there really wasn’t much significant change except for the self-employed that are going to see their self-employed national insurance rate go up.  So it was a cautious from a cautious Chancellor and we’ll need to wait and see when we get to Autumn Budget whether he is going to anything more drastic.

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