Shortly before heading to the House of Commons to deliver his first Spring Budget, Philip Hammond took to Twitter to post a picture of the famous red Budget book in all its glossy glory.
However, out of the 64 pages which constituted the Chancellor’s first Budget, the table on page 26 and 27 is once again the most revealing. 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.
In macro economic terms this was one of the most marginal budgets we can recall. The Autumn Statement saw the Chancellor put around £35 billion back into the economy from fiscal ‘loosening’ (tax cuts or increased spending), while this Spring Budget saw a net £175m given away in 5 years, some 0.5% of the impact. So if the Autumn statement did the heavy lifting this was a marginal tidy up.
The Office for Budget Responsibility produced healthier outlook forecasts for both the economy and public finances. This suggests the deficit will reduce more quickly than was thought in the Autumn but is still £100 billion worse than a year ago.