UK’s Hunt to maintain tight budget with focus on 2024 election | – #UKs #Hunt #maintain #tight #budget #focus #election
LONDON, March 8 (Reuters) – Britain’s Chancellor of the Exchequer, Jeremy Hunt, is poised to keep public finances under control in next week’s budget, with a big push ahead of the next election. tax avoids discounts or cost increases.
Hunt’s Conservative Party lawmakers to jump-start an economy on the brink of recession April corporate in the month tax they want to stop the sharp jump in the degree.
At the same time, unions and opposition parties are demanding more pay increases for nurses, teachers and other public sector workers, whose incomes have been hit by double-digit inflation.
30 in the damaged public finances billion £35.59 billion dollars) windfall, past Prime Minister It increased pressure on Hunt to soften the fiscal stance he took when he was appointed finance minister in October after Liz Truss’s “mini-budget. “
Its wide, unfunded tax his plans for cuts caused the bond market to crash and led to his replacement in Downing Street by Rishi Sunak. He and Hunt told investors that Britain it does not overthrow economic orthodoxy at all.
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Their pledge to cut Britain’s £2.5 trillion debt mountain into the economy over five years will cap it in Hunt’s March 15 budget statement.
30 of its current plans, according to the Resolution Foundation think tank billion about two-thirds of the poundage wiggle room comes from one-off factors.
The rest 10 billion pounds will be enough to cover another three months of subsidies for households hit by stronger-than-expected tax revenues, rising energy bills and another 12-month freeze on fuel duty, but little to cut costs. -accommodation crunch in the upcoming 2023/24 financial year.
However, Hunt’s reticence even now political considered as a choice: the Conservative Party expected in 2024 national ahead of the election, the opposition Labor Party will need all the help it can get next year to overcome its huge opinion poll lead.
“It’s not fiscal rules that’s why he’s waiting until next year, is it?” It’s an election schedule,” Torsten Bell, chief executive of the Resolution Foundation, said at a panel discussion on the budget this week.
Analysts at BNP Paribas also said it would be a priority for Hunt to save room for tax cuts ahead of the next election, meaning he will use only half of the £30bn windfall in public funding in next week’s plan.
VISIBLE APPEARANCE?
Hunt’s room for maneuver going forward could be further constrained if Britain’s financial watchdog becomes murkier about the economic outlook in its forecasts underpinning the budget.
So far, the Office for Budget Responsibility (OBR) has been less pessimistic about growth than the Bank of England (BoE).
In its latest forecasts in November, the OBR said gross domestic product would contract by 1.4% this year but expand by 1.3% and 2.6% in 2024 and 2025.
Last month, the BoE said GDP would show no growth in 2024 and 2025, after a 0.5% contraction in 2023.
Gas Labor shortages, lingering productivity problems and the fallout from Brexit risk undermining the economy, even if the recent drop in prices softens an expected recession this year.
The UK is the only G7 country whose economy has yet to return to its pre-pandemic size.
Hunt said he would outline economic growth measures in the budget, including ways to tackle Britain’s shrinking workforce.
April He is expected to announce tax breaks to encourage businesses to invest more and boost productivity, despite a rise in the corporate tax rate from 19% to 25%.
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Written by William Schomberg; Edited by Josie Kao
Our standards: Thomson Reuters Trust Principles.
2023-03-08 11:47:15
Source – reuters
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