Chancellor Philip Hammond has delivered his Spring Statement, in which he predicted falling inflation but growth remaining well below the OECD average.
He claimed there was a “light at the end of the tunnel” for the UK economy and predicted falling inflation, debt, and borrowing, but there was little to celebrate.
The chancellor told MPs growth was forecast to be 1.4% this year, 0.1% higher than forecast by the Office for Budget Responsibility (OBR) in November, with the forecast for 2019 and 2020 unchanged at 1.3%. Both figures show the UK economy continues grow at one of the slowest rate of any nation in the Europe, just as the UK embarks on Brexit, shifting away from its main export market by leaving the single market and customs union
In a break with recent tradition, Hammond did not use the financial statement present a “mini-Budget”, but did unveil a number of consultations on future policies, including a reduction on tax for the least polluting vans and a new VAT collection mechanism.
He ruled out ending austerity, but hinted he could increase spending on defence and the NHS in his Autumn Budget.
Labour accused the chancellor of “astounding complacency” in the face of the public sector funding crisis and called on the government to immediately bring an end to austerity and to increase funding for the NHS to try and reduce the burden on the struggling and underfunded health service. Labour’s shadow chancellor John McDonnell asked “How many people have to die waiting in an ambulance before he acts?”