Richard Hughes

Another summer blockbuster (on fiscal risks) from the OBR

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Today the OBR published its second Fiscal Risks Report, a comprehensive assessment of all the things that could go wrong with the UK’s public finances over the next 50 years. And it is a summer blockbuster – topping out at 293 pages in total. Fiscal risk analysis is the new cutting edge in fiscal policymaking, … Continued

Torsten Bell

Is rising inequality helping to swell the coffers for Fortunate Phil?

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Fortunate Phil is not what the Chancellor generally gets called. But as he prepares for tomorrow’s Spring Statement, Philip Hammond – despite facing what looks like headline bad news – has at least some reasons to be grateful for good luck on both the economic and political fronts. The Treasury is gearing up for the … Continued

Matthew Whittaker

Hitting the books: student loans and the public finances

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With everything that’s going on in British politics right now, it’s easy to forget that the government was celebrating some seriously good news just seven weeks ago. You might remember that the Chancellor got handed a £74 billion fiscal windfall at the Budget that allowed him to deliver the long-promised extra spending on the NHS … Continued

James Smith

Pessimism, Politics and Economics: the real Budget story

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Debates following this week’s Budget have been dominated by political arguments about whether the Chancellor’s spending splurge means that austerity had been ended or lives on (our view: austerity was significantly eased but not ended). But another debate has been conspicuously absent this week, having dominated the UK’s political economy for the past eight years: … Continued

Torsten Bell

The Budget marks a very significant easing – but not an end of austerity

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Marriages require compromise. So we shouldn’t be surprised that the reluctant political marriage between Theresa May and Phillip Hammond has delivered a compromise Budget. Caught between the Prime Ministers promise to “end austerity”, the wish to see debt falling, and the reality of the parliamentary arithmetic making significant tax rises difficult the Chancellor has taken … Continued

James Smith

The OBR on Brexit: known-unknowns and unknown-unknowns cast shadow over the Budget

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As if Philip Hammond’s job over the next few weeks wasn’t tough enough already, the Office for Budget Responsibility (OBR) this morning has published its thinking on how Brexit will make his life harder for many years to come. Already charged with “ending austerity” (which, as Torsten pointed out last week, is a stretch to … Continued

Public spending
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Tax
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Intergenerational Centre
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Political parties and elections

Britain is set to replace the era of austerity with a new era of tax rises

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The main message that has united both main party conferences over the last fortnight is that the era of austerity is over. For Labour that means more spending on new things – from universal childcare to a mass programme of nationalisation. And for many Conservatives it means a return to what they love doing best … Continued

Matthew Whittaker

Is there enough fuel in the fiscal tank for another duty freeze?

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After eight years of freezes, it had started to look like successive governments’ cancellation of the annual RPI-linked uprating of fuel duty had run out of road. After all, it’s already costing the government around £9 billion a year, and that cost will grow with each passing year. But we now know that the Chancellor … Continued

Matthew Whittaker

Five charts to chill the Chancellor’s blood ahead of the Budget

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We now know that this year’s Budget will be delivered on 29 October, making it the first Monday Budget since 1962. The traditional Wednesday has been avoided, we’re told, to side-step negative Halloween-based headlines. Yet there’s still plenty of scary stuff for the Chancellor to deal with – from finding the £20 billion needed to … Continued

Torsten Bell

What Philip Hammond will say today: the deficit is dead, long live the debt

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Philip Hammond is going to give a very short speech at the Spring Statement today. There will be none of the tax and spending announcements we are used to when Chancellors rise to the Despatch Box. But short and largely announcement free as it will be, tomorrow’s speech will nonetheless represent something very significant for … Continued

Public spending
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Economy and public finances
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Political parties and elections

How do the main parties’ fiscal policies compare?

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The parties’ manifestos cover a lot of ground. But what would their fiscal policies mean for the country? As we set out in an earlier report, boring-sounding rules about the deficit matter hugely for the country’s public debt trajectory, the parties’ delivery of services and tax and benefit policies, and for accommodating coming demographic challenges. … Continued

Torsten Bell

Put your crocs away, but get your calculators out – we still need to talk about the deficit

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Fashions come and fashions go, in politics as on the catwalk. One minute an issue looks like it’s the only thing that matters, and the next no-politician wants to mention it. As this general election rolls on the thing that is becoming ever clearer is that the fiscal deficit is the British political equivalent of … Continued

Torsten Bell

The Autumn Statement debate has focused on the public finances – but the impact on family Budgets is just as stark

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Yesterday’s discussion of the Chancellor’s first (and last) Autumn Statement understandably focused on the very significant increase in borrowing that the first official take on the economic impact of the decision to leave the EU unveiled. In short the Office for Budget Responsibility thinks the Brexit vote is expensive – coming with a price tag … Continued

Matthew Whittaker

Resolution Foundation reaction to Autumn Statement 2016

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£59bn impact of Brexit and Chancellor’s decision to increase investment spending drive £122bn extra borrowing Philip Hammond chooses not to support just about managing families who face a double whammy of lower earnings and benefit cuts Slower growth and higher inflation will mean higher borrowing and a parliament of falling living standards for millions – … Continued

Torsten Bell

Is the Chancellor planning a £32bn pre-election take-away? I wouldn’t bet on it

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If you’re the kind of person that finds money down the back of your sofa, the chances are you’re the kind of person that also loses it down there in the first place. That’s the lesson the Chancellor was taught by his Budget yesterday. At the centre of all the Commons rhetoric, stats and pun-strewn … Continued

Torsten Bell

Budget response: the sofa can go from being a cashpoint to a pickpocket overnight

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TREASURY CHOOSES TO ACCEPT £38bn EXTRA BORROWING IN FACE OF ECONOMIC HEADWINDS OBR gives the Chancellor a £55bn fiscal black hole, double the £27bn windfall from the Autumn Statement The weaker outlook for productivity and pay has led the OBR to give George Osborne a £55bn fiscal hole, reversing twice over the £27bn fiscal windfall … Continued

How much wriggle room will the Chancellor have in the July Budget?

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After the flow of easy pre-election promises, here come the hard choices of government. As George Osborne approaches his ‘emergency Budget’ attention will turn to what room for manoeuvre he really has given all the commitments that have been made. How will it all add up and is there a version of austerity that might … Continued

How tightly has the Chancellor tied his own hands on fiscal policy?

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Having secured a majority on 7 May, the Conservatives must now set about the difficult job of delivering on their various pre-election pledges. In relation to fiscal consolidation in particular, they can no longer point to the demands of a junior coalition partner as cause for rowing back on any of the harder to execute … Continued

Public spending
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Economy and public finances
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Political parties and elections

How far apart are the Conservatives and Liberal Democrats on fiscal policy: could the coalition renew its vows?

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Recently we looked at the degree of potential overlap between Labour and Liberal Democrat fiscal plans, and found that the parties are not as far apart as might first be assumed. In this second note, we consider the relative positions of the Conservatives and Liberal Democrats. The Conservative goal appears relatively straightforward: they want to … Continued

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