A shake-up of public finances is widely expected in 2019, but not until later in the year. However, it is expected to be debated during the 2019 Spring Statement on March 13th.
The Spring Statement will begin at 12:30pm and last for 20 minutes, with the whole debate lasting approximately two hours.
Setting the tone
The Chancellor, Philip Hammond, will set the tone for the whole of government. The spending review will be the first review of its type for nearly four years.
The date for the Spending Review has not yet been set, but after nine years of austerity it could turn out to be one of the most important non-BREXIT decisions made by this government.
In the meantime, we will have to make do with the details divulged in the Spring Statement, which will be the Chancellor’s last major speech before the UK leaves the EU on March 29th.
The Spring Statement is the opportunity for the Chancellor to update the country on the state of the UK’s economy. Prior predictions for economic growth will likely be tweaked, not least on the account of the effects of BREXIT.
Keeping up-to-date with the Spring Statement
The Spring Statement will be broadcast live on the major news channels and streamed live on ParliamentLive.TV
What can we expect in the Spring Statement?
The Chancellor will respond to the updated financial predictions from the independent Office for Budget Responsibility (OBR).
The figures are expected show that Britain’s finances are in the black again. They will also show the projected GDP growth and borrowing for the UK government for future years.
The spring statement is a good opportunity for the government to update MPs on the progress from the previous Budget of Autumn 2018. The government may also take the spring statement as an opportunity to consult on a few longer-term policies.
No major changes or rises in taxation are expected this time, but this cannot be confirmed until the day.
How is the economy right now?
‘Not great, could be better’, is one way of looking at it.
The Chancellor has said that the economy is “solid” and there is no recession on the horizon, despite figures showing the weakest growth since 2012.
The OBR released figures in the Economic and Fiscal outlook in October 2018, that showed growth in the UK economy was slower than expected at just 0.2% in the last three months of 2018, which was slightly below the expected 0.3% in March 2018.
A large positive contribution from the services sector was partially offset by smaller negative contributions from the production and construction sectors.
Services grew by 0.4% in Q4 2018, while Production growth fell by 1.1%, Manufacturing fell by 1.5% and Construction fell by 0.3%. See www.ons.gov.uk for further details.
As of December 2018, annual GDP growth was the lowest since 2012, at 1.4%, with GDP falling by 0.4% in December 2018.
Any good news?
There is some good news however, GDP is expected to grow by 6.1% up to 2022-23, which us up from the 5.5% growth predicted in March 2018.
Is BREXIT to blame for the slow-down?
Mr Hammond told Sky News: “It’s a solid performance from the economy when you look at what’s happening globally and in other competitor countries.
“But of course, there is no doubt that our economy is being overshadowed by the uncertainty created by the Brexit process.
“The soon we can resolve that the better, and the quicker we can get back to more robust growth in the future.”
What else can we expect?
The above should just about fill the allotted 20 minutes and certainly will provide enough content for the following 2-hour debate.