Highlights of Chancellor’s Spring Statement
The Government remains on track to meet its fiscal targets early, Philip Hammond said.
Chancellor Philip Hammond has delivered his Spring Statement to MPs.
Among the highlights:
– An extra £100 million is to be made available to police forces over the course of the next year “to pay for additional overtime targeted specifically on knife crime”, the Chancellor announced.
– The Government will fund free sanitary products in secondary schools and colleges in England from the next school year.
– Some 445,000 square kilometres of ocean around Ascension Island are to be declared a Marine Protected Area.
– Measures to move to a carbon-neutral economy include a study into carbon offsets for air travellers; help for small businesses to cut emissions; proposals to increase the proportion of “green gas” in the grid; and a Future Homes Standard to mandate the end of fossil-fuel heating in new homes by 2025.
– Mr Hammond announced a new £3 billion Affordable Homes Guarantee scheme to support delivery of around 30,000 affordable homes and £717 million from the Housing Infrastructure Fund to unlock up to 37,000 new homes on sites in West London, Cheshire, Didcot and Cambridge.
– A report by Professor Jason Furman, Barack Obama’s former Chief Economist, sets out recommendations to overhaul competition regulation in the digital industry, and the Competition and Markets Authority is to undertake a study of the digital advertising mark.
– Funding of £79 million allocated to the ARCHER2 supercomputer at Edinburgh University, £45 million for genomics research at the European Bioinformatics Institute and £81 million for a new Extreme Photonics Centre in Oxfordshire, along with a guarantee of UK funding for the JET nuclear fusion reactor, whatever happens with Brexit.
– From June, the UK will begin to abolish the requirement for paper landing cards at points of entry to the country and will allow citizens of the USA, Australia, New Zealand, Canada, Japan, Singapore and South Korea to use e-gates at airports and Eurostar terminals.
– A £700 million package of reforms to help small businesses take on more apprentices, announced in the autumn Budget, is to be brought forward to the start of the new financial year in April.
– The Chancellor announced up to £260 million for the Borderlands Growth deal covering the border regions of England and Scotland and said negotiations are progressing on future deals for mid-Wales and Derry/Londonderry.
– Mr Hammond told MPs: “A no-deal Brexit would deliver a significant short to medium-term reduction in the productive capacity of the British economy. And because our economy is operating at near full capacity, any fiscal and monetary response would have to be carefully calibrated not to simply cause inflation.”
– Mr Hammond said he will decide in the Spending Review later this year how to share the proceeds from any “Deal Dividend”, if the UK leaves the EU with a deal, between increased spending on public services, capital investment and keeping taxes low.
– Debt is forecast to be lower in every year than predicted at the Budget, falling to 82.2% of GDP next year, then 79%, 74.9% and 74% in the following years and 73% in 2023/24.
– The Government remains “on track” to meet both its fiscal targets early, with the cyclically adjusted deficit at 1.3% next year and falling to 0.5% by 2023/24. Headroom against the fiscal mandate increases from £15.4 billion at the time of the autumn Budget to £26.6 billion today.
– Borrowing this year will be 1.1% of GDP – £3 billion lower than forecast at the Autumn Budget. Borrowing will be £29.3bn in 2019/20, then £21.2bn, £17.6bn and £14.4bn in the following years to reach £13.5bn in 2023/24 – its lowest level in 22 years.
– The OBR forecasts the economy will grow 1.2% this year, 1.4% next year and 1.6% in the following three years, Chancellor Philip Hammond told MPs.
– The OBR expects to see 600,000 new jobs by 2023, with wage growth at 3% or higher in each year of the forecast period.
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