Chancellor Philip Hammond has released his Spring Statement, predicting falling inflation and borrowing. In his statement he stated that the UK economy has reached a turning point and there was ‘light at the end of the tunnel’.
He did however, rule out an end to austerity as of yet, though he did hint at a possible spending rise in the future.
Hammond stated that in his Autumn statement, he would set an overall path for public spending for 2020 and beyond, with a full detail spending review in 2019.
For this year’s forecast, the chancellor stated that growth is to be 1.5%, which is up from 1.4% prediction which was set by the Office of Budget Responsibility (OBR) in November. Yet even with all this growth the chancellor has stated that the forecast will remain unchanged for 2019/2020 at 1.3%.
OBR chief Robert Chote stated that the UK overall was borrowing less than forecasted this year due to more tax coming from self-employed workers, with revenues £2.9bn higher than predicted.
How will it affect Brexit?
The OBR has calculated that the UK will still continue to pay contributions into the EU budget until 2064. Which will be 45 years after the official date the UK plans to leave the EU. The total withdrawal bill the UK will have to pay amounts to £37.1 bn.
With Hammond suggesting that business confidence is growing throughout the Brexit negotiation process. However, the UK beat the forecast in 2017, and hoping to beat it again in 2018.
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