Budgets & fiscal events· Public spending· Economy and public finances· Tax Back for more? Putting the 2024 Spring Budget in context 7 March 2024 by Camron Aref-Adib and Torsten Bell and Mike Brewer and Molly Broome and Alex Clegg and Nye Cominetti and Adam Corlett and Emily Fry and Jonathan Marshall and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Greg Thwaites and Lalitha Try In this briefing note, we put the decisions in the Spring Budget 2024 in context, discussing how the economic outlook has changed, what that means for the public finances, and how the policy decisions taken at the Budget will affect living standards in both the short and the medium term. READ MORE
Budgets & fiscal events· Economy and public finances The Election Budget Spring Budget 2024 preview 21 February 2024 by Alex Clegg and Adam Corlett and Cara Pacitti and Hannah Slaughter and James Smith and Greg Thwaites In this slide pack we preview the upcoming Budget, assessing the economic and fiscal outlook ahead of what will be a key pre-election economic-policy event. We focus on the scope for cutting taxes, and the implications of different policy choices, putting the Chancellor’s upcoming decisions in a broader context. We find that, despite near-term bad … Continued READ MORE
Living standards· Prices & consumption· Pay· Wellbeing and mental health· Housing Pressure on pay, prices and properties How families were faring in October 2023 14 December 2023 by Mike Brewer and Felicia Odamtten and Hannah Slaughter and Hannah Slocombe and James Smith Two years into the cost of living crisis, inflation has finally turned a corner. The headline rate of CPI inflation has fallen from its October 2022 peak of 11.1 per cent to 4.6 per cent in October 2023, and the Prime Minister has been able to say that his target of halving inflation in 2023 … Continued READ MORE
Budgets & fiscal events· Economy and public finances A pre-election Statement Putting the Autumn Statement 2023 in context 23 November 2023 by Camron Aref-Adib and Torsten Bell and Mike Brewer and Molly Broome and Alex Clegg and Nye Cominetti and Adam Corlett and Sophie Hale and Lindsay Judge and Jonathan Marshall and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Greg Thwaites and Lalitha Try In this briefing note, we put the decisions in the 2023 Autumn Statement in context, discussing how the economic outlook has changed, what that means for the public finances, and how the policy decisions taken will affect living standards in both the short and the medium term. READ MORE
Budgets & fiscal events· Economy and public finances Preparing the pitch Autumn Statement 2023 preview 6 November 2023 by Adam Corlett and Jonathan Marshall and Charlie McCurdy and Louise Murphy and Cara Pacitti and Simon Pittaway and Hannah Slaughter and James Smith and Greg Thwaites In our Autumn Statement preview slidepack, we assess the economic outlook ahead of Jeremy Hunt’s Autumn Statement on November 22nd, and explore the policy choices facing the Chancellor as inflation drives up tax revenues, and interest rates drive up the cost of government debt. We find that the Chancellor is in difficult terrain: although the … Continued READ MORE
Economy 2030 Built to last Towards a sustainable macroeconomic policy framework for the UK 19 October 2023 by Simon Pittaway and James Smith This paper, part of the Economy 2030 Inquiry, tackles the key question of how to futureproof the UK’s macroeconomic policy framework. Looking beyond the immediate policy challenge of high inflation, it focuses on whether the current framework – largely set during the calmer economic times of the 1990s – is still fit for purpose. Since … Continued READ MORE
Macroeconomic policy Macroeconomic Policy Outlook: Q3 2023 5 October 2023 by Simon Pittaway and James Smith and Greg Thwaites In this edition of the MPO we focus on the scale and nature of the UK’s inflation challenge, looking at what we can learn from comparisons with other countries, and what that means for monetary policy. A key reason to worry about UK inflation is that it looks exceptional: it is the highest headline inflation … Continued READ MORE
Living standards· Incomes· Prices & consumption Food for thought The role of food prices in the cost of living crisis 19 May 2023 by Torsten Bell and James Smith and Lalitha Try The cost of living crisis is often thought of as a cost of energy crisis. That is an understandable, but increasingly inadequate, view. In particular, it understates the growing role of food prices (up by 25 per cent over the past year and a half) in the squeeze on living standards that households – especially … Continued READ MORE
Economy 2030 Cutting the cuts How the public sector can play its part in ending the UK’s low-investment rut 30 March 2023 by Felicia Odamtten and James Smith Britain is a low investment nation. Worse, it has now been one for decades. Total investment as a share of GDP has consistently been below the average of other rich countries for decades. This century, the UK has consistently (in all but two years) been in the bottom 10 per cent of countries in the … Continued READ MORE
Budgets & fiscal events· Economy and public finances We’re going on a growth Hunt Putting the 2023 Spring Budget in context 16 March 2023 by Torsten Bell and Mike Brewer and Molly Broome and Nye Cominetti and Adam Corlett and Emily Fry and Sophie Hale and Karl Handscomb and Charlie McCurdy and Louise Murphy and Felicia Odamtten and Cara Pacitti and Simon Pittaway and Krishan Shah and James Smith and Greg Thwaites and Lalitha Try This report examines the economic backdrop to Budget 2023, and assesses whether the Chancellor has successfully delivered on his central objective of boosting growth through higher employment and business investment. READ MORE
Budgets & fiscal events· Economy and public finances New Budget, same problems Spring Budget preview 6 March 2023 by Molly Broome and Adam Corlett and Emily Fry and Karl Handscomb and Louise Murphy and Felicia Odamtten and Cara Pacitti and Krishan Shah and Hannah Slaughter and James Smith and Greg Thwaites and Lalitha Try In our Spring Budget preview slidepack, we assess the economic outlook ahead of Jeremy Hunt’s Spring Budget on March 15th, and explore the policy choices facing the Chancellor in three key areas: cost-of-living support, public sector pay and boosting growth. We find that there is finally some good news for the Chancellor in the short … Continued READ MORE
Living standards· Prices & consumption The only way is down Assessing the impact of falls in wholesale energy prices on household and public finances 7 February 2023 by Emily Fry and James Smith Huge rises in energy prices through much of 2022 sparked a cost of living crisis with recession-level hits to family (as inflation soared) and public finances (as the state partially protected us from bill rises). But there has finally been some good news with wholesale gas prices for 2023-24 down more than 70 per cent … Continued READ MORE
Monetary policy· Macroeconomic policy Macroeconomic Policy Outlook: Q4 2022 10 December 2022 by Emily Fry and Sophie Hale and James Smith [1] The UK is experiencing high levels of inflation not encountered for 41 years, reaching 11.1 per cent in October. But what matters most for both people and policy makers is how persistent this inflation is, which will influence how long the cost of living crisis will last. This inflation has been driven by global … Continued READ MORE
Budgets & fiscal events· Economy and public finances Help today, squeeze tomorrow Putting the 2022 Autumn Statement in context 18 November 2022 by Torsten Bell and Mike Brewer and Molly Broome and Nye Cominetti and Adam Corlett and Emily Fry and Sophie Hale and Karl Handscomb and Jack Leslie and Jonathan Marshall and Charlie McCurdy and Krishan Shah and James Smith and Greg Thwaites and Lalitha Try This report presents Resolution Foundation’s analysis of the 2022 Autumn Statement. In the face of grim economic and fiscal forecasts, Jeremy Hunt announced energy support today but tougher times tomorrow, with stealth tax rises for the middle and top of the income distribution followed by spending cuts after the next election. READ MORE
Monetary policy· Macroeconomic policy The art of expectations management A bleak outlook from the Bank of England as it scales back rate hike expectations 3 November 2022 by James Smith The Bank of England has raised rates by 75 basis points today – the eighth successive increase and the largest since 1989 – to 3 per cent, the highest since November 2008. Despite this historic rise, the big news was that the Bank signalled very clearly that market expectations for further rate rises had gone … Continued READ MORE
Budgets & fiscal events· Economy and public finances Mind the (credibility) gap Autumn Statement preview 1 November 2022 by Torsten Bell and Adam Corlett and Jack Leslie and Jonathan Marshall and Felicia Odamtten and Krishan Shah and James Smith and Lalitha Try In our Autumn-Statement preview slidepack, we present new analysis that explores the economic outlook ahead of the Autumn Statement on 17 November, and the critical decisions that the new Prime Minister and Chancellor must make. With the latest political turmoil triggered by attempts to completely rewrite economic policy, Rishi Sunak and Jeremy Hunt are under … Continued READ MORE
Budgets & fiscal events· Public spending· Economy and public finances· Tax Cutting tax cuts Jeremy Hunt rewrites Government’s economic policy 17 October 2022 by Torsten Bell and Adam Corlett and Karl Handscomb and Jonathan Marshall and James Smith The new Chancellor has rewritten UK economic policy in order to reduce the pressure on the Bank of England to raise interest rates and the Treasury to deliver spending cuts. He has now reversed 60 per cent of the tax cuts announced less than four weeks ago and committing to scale back support for energy … Continued READ MORE
Monetary policy· Macroeconomic policy Macroeconomic Policy Outlook: Q3 2022 10 October 2022 by Jack Leslie and Krishan Shah and James Smith In this edition of the MPO we consider the nature of the inflation challenge facing the Bank of England and the impact of the ‘Mini Budget’ on it. Here it is important to remember that the colossal scale of the energy shock – which for household incomes could be three times the size of that … Continued READ MORE
Budgets & fiscal events· Economy and public finances What next? The impact of Trussonomics, tax cuts and market turmoil 29 September 2022 by Torsten Bell and Emily Fry and Karl Handscomb and Jack Leslie and Krishan Shah and James Smith The last few days have seen a radical reshaping of the Government’s economic policy and a radical reaction from financial markets. Out have gone both Treasury orthodoxy and the legacy of the Johnson premiership, and in are lower taxes, higher borrowing – and higher borrowing costs as spooked markets respond. Will this new strategy boost … Continued READ MORE
Budgets & fiscal events· Economy and public finances Blowing the budget Assessing the implications of the September 2022 fiscal statement 24 September 2022 by Torsten Bell and Molly Broome and Nye Cominetti and Adam Corlett and Emily Fry and Karl Handscomb and Lindsay Judge and Jack Leslie and Louise Murphy and Krishan Shah and Hannah Slaughter and James Smith and Greg Thwaites and Lalitha Try The Chancellor decided to blow the budget in his first fiscal statement, bringing forward a £45 billion package of tax cuts, the biggest for 50 years. In this briefing note, we show that today’s Government is no longer fiscally conservative nor courting the Red Wall. Instead, debt is on course to rise in each and every year of the forecast period, and the focus has shifted to the South of England, where the beneficiaries of these tax cuts are more likely to be living. READ MORE
Living standards· Public spending· Economy and public finances A blank cheque An analysis of the new cap on energy prices 13 September 2022 by Adam Corlett and Jack Leslie and Jonathan Marshall and James Smith Liz Truss’s first major act as Prime Minister was to set out a huge energy support package to reduce the scale of the living standards’ catastrophe this winter, with the Energy Price Guarantee (EPG) as its highlight. The EPG will mean that annual energy prices for the typical household are capped at £2,500 for two … Continued READ MORE
Monetary policy· Economic growth· Macroeconomic policy Slower for longer The Bank of England tightens monetary policy again and warns that the outlook is bleak 4 August 2022 by Jack Leslie and James Smith The Bank of England today unveiled the biggest rise in interest rates since 1995 along with plans to bring down the stock of Quantitative Easing (QE) by £80 billion over the next year. But the real news in today’s announcements was the extent to which the central bank expects the cost of living crisis to … Continued READ MORE
Economy 2030· Macroeconomic policy As good as it gets? The forces driving economic stagnation and what they mean for the decade ahead 18 July 2022 by James Smith With inflation at levels not seen since the early 1980s, it is clear that the UK is in the midst of a huge hit to real incomes. But the seeds for the devastating impact of the cost of living crisis were sown by a slump in growth that is unprecedented in the post-war period and … Continued READ MORE
Monetary policy· Fiscal policy· Macroeconomic policy Crunch time Bank of England raises rates again and signals cost of living crisis is set to deliver a £1,200 hit to incomes 5 May 2022 by Adam Corlett and Jonathan Marshall and James Smith Today the Bank of England’s Monetary Policy Committee raised rates at a fourth successive meeting – a first in the 25 years since it was granted independence – to 1 per cent, a level not seen since the financial crisis. The direct impact of this change in rates on households will be small in the … Continued READ MORE
Budgets & fiscal events· Public spending· Economy and public finances Inflation Nation Putting Spring Statement 2022 in context 24 March 2022 by Torsten Bell and Mike Brewer and Adam Corlett and Sophie Hale and Karl Handscomb and Lindsay Judge and Jack Leslie and Jonathan Marshall and Louise Murphy and Krishan Shah and James Smith and Hannah Slaughter and Greg Thwaites This briefing note provides an assessment of the measures announced in the March 2022 Spring Statement. The Chancellor approached this with the highest inflation in 40 years and the worst income squeeze on record lying ahead of us. Against that backdrop, and with plenty of fiscal ammunition (thanks to the Office for Budget Responsibility’s (OBR’s) … Continued READ MORE
