Staring down the barrel of double-digit inflation, the Chancellor had to act. With the highest tax load in the last 70 years, this was a situation where we found out just how prudent this ex-banker really is.
The figures did not make good reading, with the UK economy forecast to grow by just 3.8% this year, according to the Office for Budget Responsibility, (OBR) a sharp cut from its previous prediction of 6.0%. It is also way below the rate of inflation, meaning a shrinkage in economic activity overall.
Martin Lewis, the self-styled money saving expert, went on to warn that if Mr Sunak doesn't make the appropriate changes for struggling families soon "there will be people still having to make a choice between starving and freezing."
The economy is then forecast to grow by 1.8% in 2023, 2.1% in 2024, 1.8% in 2025 and 1.7% in 2026. The annual inflation rate was 6.2% in February and is likely to average 7.4% for the rest of this year, but with peak of 8.7% in the final quarter of 2022. These are shockingly bad figures and represent what this Party warned would happen after two years of crushing the economy.
The unemployment rate is now predicted to be lower over the next few years than in the OBR's previous forecast in October, but so many of the new vacancies are part-time, made up with Universal Credit. They are not helping the government’s balance of payments.
Debt as a percentage of GDP is expected to fall from 83.5% of GDP in 2022/23 to 79.8% in 2026/27. This is the failed arithmetic of “Spreadsheet” Phil Hammond, who despite alleged “austerity”, did not reduce government debt in any single year he was in the role.
The 5p cut from fuel duty is welcome, but will it show at the pump? In comparison, the French government reduced fuel duty by 17c – and the price at the pump went down immediately. We shall see what happens here.
The most shocking statistic is saved till last. The government is forecast to spend £83bn on debt interest in the next financial year, the highest on record. Based on a population of 67 million, that is a figure of £1238.80 for every man, woman and child in the UK.
And these are the “conservative” ones?
Martin Day – Party Secretary