Following on from George Pascoe-Watson’s political analysis of the challenges for the Chancellor, we have pulled together our summary of the big announcements from Osborne’s speech today. We have highlighted the key numbers and looked at the politics behind the announcements of today’s Autumn Statement.
Portland’s Chief Economic Adviser and former City Minister, Kitty Ussher, will also be giving us her views tomorrow on the economics of the speech.
1. The politics behind the policies
The Statement was a clear signal from Osborne on how he thinks the Tories can win the election. Rather than pre-2015 giveaways, he drew a clear dividing line between the Coalition and the Labour party. Firstly, that they are ‘fixing the roof while the sun shines’ – something which Labour didn’t do and which they have argued against since 2010. Secondly, that growth alone is not enough, and that austerity must continue to achieve a budget surplus by 2018/19 – backing Labour into a corner on future spending decisions.
2. The numbers
Growth, employment, borrowing and deficit forecasts were all revised in the right directions. The UK is now experiencing faster growth than France, Germany and the US, and taken overall, this is the best improvement in growth forecasts for 14 years. Debt will continue to rise albeit slightly slower than forecast, peaking at 80% of GDP in 2015. The clear message from Osborne was: the plan is working, don’t let Labour mess it up.
Tax & spend