Chancellor Rishi Sunak is up for his first Budget, the Parliament’s first Budget, the first Budget since 2018...
“We will get through this together. The British people may be worried, but they are not daunted. We will protect our country and our people. We will rise to challenge”
“We will get through this together. The British people may be worried, but they are not daunted. We will protect our country and our people. We will rise to challenge”
Chancellor - “we will do whatever it takes” to deal with “significant impact” on the economy.
“For a period its going to be tough”
“But it will be temporary”
“For a period its going to be tough”
“But it will be temporary”
“We can’t avoid a fall in demand, because the primary driver of that reduction in consumption… …the primary reason people are not spending as normal… …is because they’re following Doctors’ orders to stay at home,” says Sunak
“Temporary, timely and targeted” says Chancellor, exactly same quote as his predecessor Darling said of VAT cut in 2008
Sunak: Statutory Sick Pay now available for all those advised to self isolate - even without symptoms.
Benefits for self employed available from Day 1... minimum income floor in Universal Credit temporarily removed, relax need to visit job centres - cost £500m...
Benefits for self employed available from Day 1... minimum income floor in Universal Credit temporarily removed, relax need to visit job centres - cost £500m...
For businesses with fewer than 250 employees Government will fund SSP for two weeks - £2billion - big move to encourage self isolation, good news for SMEs
Taxpayer guarantees for business interruption loans of up to £1.2m... “The government will offer a generous guarantee on those loans, covering up to 80% of losses, with no fees, so that banks can lend with confidence. ...unlocking £1bn”
Business rates scrapped for one year for half of businesses - shops, cinemas, restaurants, music venues, small hotels & B&Bs with rateable value below £51k... others will get £3k cash grant... fiscal loosening of £18bn...
£30bn overall fiscal stimulus... significant - up there with biggest in the world
OBR has downgraded UK growth and productivity before Coronavirus impact...
But extra £175bn of funding over next five years will boost economy.. - sunak
But extra £175bn of funding over next five years will boost economy.. - sunak
Growth (pre coronavirus) form OBR: the GDP forecast - 1.1% in 2020 and 1.8% in 2021, then 1.5%, 1.3%, and 1.4% in the following years.
Fiscal rules consultation announced...
Review framework that was only announced 4 months ago...
But this Budget (without the coronavirus fiscal boost) meets the Javid fiscal rules
Review framework that was only announced 4 months ago...
But this Budget (without the coronavirus fiscal boost) meets the Javid fiscal rules
OBR numbers dont include Coronavirus fiscal measures...
borrowing will increase slightly from 2.1% of GDP in 2019-20 to 2.4% in 2020-21 and 2.8% in 2021-22. falls to 2.5%, 2.4% and 2.2% in the following years.
borrowing will increase slightly from 2.1% of GDP in 2019-20 to 2.4% in 2020-21 and 2.8% in 2021-22. falls to 2.5%, 2.4% and 2.2% in the following years.
These are very significant increases in borrowing on a year ago when the OBR projected
19/20: 1.3%, 20/21: 0.9%, 0.7%, 0.6%, 0.5% -
this is a massive increase in borrowing over 5 years, even before coronavirus measures.
19/20: 1.3%, 20/21: 0.9%, 0.7%, 0.6%, 0.5% -
this is a massive increase in borrowing over 5 years, even before coronavirus measures.
Green Book reviewed “to reflect the economic geography of the country” - this could be very significant.
He’s using both gross and net investment numbers and not the /GDP numbers typically used. But £110bn is number for last year...
He’s using both gross and net investment numbers and not the /GDP numbers typically used. But £110bn is number for last year...
VAT on digital books, newspapers to be scrapped - moving it into line with physical books. not a Brexit thing, as EU changed rules to allow this in October 2018
Largest sustained fiscal boost for 30 years... fastest rate of 15%... 2.8% rises.. largest Budget giveaway since 1992 Norman Lamont Budget, says the OBR...
Legislated fiscal targets missed, says OBR, but not the new ones announced by Sajid Javid... 
Extra £96 billion borrowing in first 4 years vs latest forecast ... total £300 billion borrowing over Parliament
Extra borrowed money arises out of £30bn extra current spending a year, £15bn capital, partly funded by “direct Brexit fiscal spending”
The 15% cut in per person spending since 2010....
Is to be entirely unwound now by 2025. Fiscal rollercoaster.
Is to be entirely unwound now by 2025. Fiscal rollercoaster.
OBR say Brexit deal will lead to productivity 4% lower than otherwise:
Truly extraordinary scorecard bottom line - £175bn of fiscal giveaways reaching £50bn a year at end - more current than capital
An expensive envelope... and scoring extra revenue from customs and the EU budget single biggest revenue raiser... then C-tax - though mostly coming from borrowing...
The 3% Public Sector Net Investment “limit” appears to be a target now... for last three years - these are the numbers before and after. Highest sustained net investment since 1970s...
