Spring Statement: the main points

By staff writers
March 13, 2018

Chancellor Philip Hammond delivered his first Spring Statement today (13 March 2017).

The main points follow:

Growth

Forecast to be 1.3 per cent in 2019, 1.3 per cent in 2020, 1.4 per cent in 2021 and 1.5 per cent in 2022. The November forecast was 1.3 per cent for 2018 and 2019, for 1.5 per cent for 2021, and 1.6 per cent for 2022.

This places the UK at the bottom of the G20 on OECD forecasts for growth. Inflation is forecast to fall to two per cent by next year and wages to start rising at the same point.

Borrowing

Forecast to be £45.2 billion in 2017-18, revised down from £49.9 billion. (Equivalent to 2.2 per cent of GDP).Forecast to be 1.8 per cent of GDP in 2018-19, 1.6 per cent in 2019-20, 1.3 per cent in 2020-21, 1.1 per cent in 2021-22, and 0.9 per cent in 2022-23.

Debt

Forecast to fall as a share of GDP in 2019-2020, a year later than was forecast in November.

Forecast to be 85.6 per cent in 2017-18, 86.5 per cent in 2018-19, 85.1 per cent in 2019-20, 82.1 per cent in 2020-21, 78.3 per cent in 2021-22, and 77.9 per cent in 2021-22.

The Chancellor said he will increase public spending and investment in years ahead if public finances continue on this improved path. He confirmed a detailed spending review would take place in 2019.

Employment

Forecast of an additional 500,000 people in work by 2022.

Brexit

£1.5 billion (half the Brexit planning fund) has now been allocated to departments and administrations.

Housing

The Chancellor announced a deal with the West Midlands for 215,000 new homes by 2030-31, with the help of a £100 million grant from the land remediation fund.

The Housing Growth Partnership which provides financial support for small housebuilders will be more than doubled to £220 million.

Small businesses

The next business rates revaluation will be brought forward by one year to 2021.

A review of how to help the least productive businesses catch up with the most productive and how late payments to small businesses may be eliminated.

Skills

£500 million for T-levels and £50 million to help employers roll out placements for T-level students.

£80 million to support small business apprenticeships

Digital connectivity

First wave of funding to help roll out high-speed broadband to local areas, as part of the £190 million Challenge Fund. About £95 million allocated to 13 areas across the UK.

Plastic waste

The Chancellor announced a call for evidence to tackle reducing plastic waste, including alternative materials and how the tax system can drive technological and behavioural change.

Air quality

Consultation announced  on reduced vehicle excise duty for the greenest vans on the road.

VAT

There will be consultation on a new collection mechanism for online sales to ensure the VAT paid by consumers reaches the Treasury.

[Ekk/4]

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