The UK government’s statement on tax and spending plans has been pushed back from October 31 to November 17 to ensure it is based on the “most accurate” economic projections, chancellor Jeremy Hunt has said.
Official forecasts have suggested that the interest on the government’s debt could be reduced by £10 billion compared to just a few weeks before, when Liz Truss’ mini-Budget spooked the markets.
Hunt’s reversal of the mini-Budget and the installation of Rishi Sunak as prime minister have calmed market conditions, which has given the government some leeway to push the date back.
The November 17 statement will also take the form of a full autumn statement, indicating that Hunt may announce more wider decisions on tax policy.
The chancellor has reassured that his plans are intended to bring government debt down in the medium term and “restore confidence that the United Kingdom is a country that pays its way”.
The delay on the announcement, Hunt explained, would ensure that his plans “stand the test of time”.
As PM, Sunak has pledged stronger public services, which suggests that new tax measures as opposed to spending cuts may be introduced.
The prime minister has said that it is “important to reach the right decisions and there is time for those decisions to be confirmed with cabinet” thanks to the delay, with some of those calls set to be “difficult” ones to make.
With the statement being moved, it does mean that the next meeting of the Bank of England’s Monetary Policy Committee which sets interest rates – set for November 3 - will occur without them knowing the full extent of the government’s plans.
Inflation hit 10.1 per cent in September and the Bank has warned that it may need to increase rates further than anticipated.
Hunt said that he had informed the Bank of England’s governor, Andrew Bailey, of the decision to delay, and that he “understands” why the decision has been made.
Alongside the statement, an independent forecast on how the government’s policy plans going forward will impact economic growth and spending will be provided by the Office for Budget Responsibility.
