Defying expectations of a quiet Budget, the Chancellor yesterday delivered a statement with bigger political and economic shifts than many anticipated. Given the task of delivering a Prime Ministerial promise to ‘end austerity’ with a parliamentary arithmetic that rules out significant tax rises, Philip Hammond seized the lifeline of a much improved public finance forecast to significantly ease, but not end, austerity.
There will be tougher choices for Chancellors in the years ahead, however. Brexit must be delivered smoothly, public spending will remain tight, forecasts may not always be so rosy, living standards are set to be sluggish and the tax rises to meet pressures in the 2020s from our ageing society will still be needed – as and when there’s a government with the majority to deliver them. Austerity has been eased, but there are still tough times ahead.