View from the Street: Autumn Statement Quick Flash View


View from the Street: Autumn Statement Quick Flash View

The media is full of facts and analysis on the Autumn Statement. This table is the most important. It shows the impact of each measure on the public finances: a (-) is a ‘giveaway’ or fiscal boost from Treasury to the economy, (+) takes money out of the economy and into the public finances.

This is the largest net giveaway in recent times, demonstrating the seriousness of the post-Brexit vote outlook. For comparison, the post-financial crisis April Budget 2009 put a net £30m into the economy over 3 years (-£5160m in 2009/10, -£100m in 2010/11 and +£5230 in 2011/12). This Autumn Statement puts a net £10,575m into the economy from the public finances between 2016/17 and 2018/19, with a further £25,440m in the subsequent 3 years.

This, plus deteriorating economic forecasts, explains why the deficit forecasts have worsened by £122 billion in the next 5 years, including the one ending March 2017.

Forecasts are just forecasts. Predicting the public finances is the toughest of jobs and the Office for Budget Responsibility do as well as anyone could - but still struggle. On any measure, these figures demonstrate that the good ship HM Treasury is in increasingly stormy seas in the aftermath of the 23rd June vote.