There are three government economic aims to halve inflation, ensure growth and have falling debt levels in the medium term. Fortunately there are measures which would help with all of these. The essential task should be to provide incentives to expand capacity in this country.
We are short of employees, short of some skills, short of home produced food and energy, lacking in many types of industrial output from steel to chemicals, short of hospital beds and transport capacity.
Most of this outside the NHS needs to be private sector activity and investment.
The government says it is going to take a series of measures to encourage more people back into the workforce. Older people may need tax changes and incentives to return to the workforce. Younger families may need help with childcare costs. Some need better training and support in work. I will support the measures they have chosen to help to bridge the gap between jobs available and people willing to do them. I do not support the low wage migrant model for meeting our employee needs.
The government says it wants to see more investment in energy and industry. In that case it needs to keep the corporation tax rate down. The decision to hike the rate makes us less competitive. The introduction of a 100% initial allowance for the costs of certain investments is helpful, but it is replacing the more generous super deduction we have at the moment so it is not going to give us any boost. At the very least the windfall taxes should be true windfall taxes that come down or end when the price of energy abates below a stated high level. Better still the government should cut taxes and remove subsidies at the same time. The money go round of adding taxes to high priced energy and then needing to give bigger subsidies to buy it makes little sense. Indeed, the high windfall taxes especially if allied to higher corporation tax will cut energy investment when we need more of it to increase supply and temper the price.
The OBR has changed its forecast for the current year deficit yet again. It was £99bn in the March forecast, £177 bn in the November forecast and now £152bn. I said in March they were too low and in November a bit high. They must be closer to getting it right now there are only a couple of weeks to the year end they are forecasting. Their estimate for next year of £131.6bn may be optimistic as they are forecasting slow growth and may be overestimating the revenue they can collect with some higher rates. They underestimated the Corporation tax revenue this year when it stayed at a lower rate.
They anticipate inflation collapsing to zero by 2025 for no obviously good reason. That seems unlikely, unless we do get an unforeseen recession. They now anticipate a much lower rise in unemployment this year and next than in the previous forecast. They now expect the UK to avoid recession this year after forecasting a down year at minus 1.4% in November, Their frequent changes of forecast, their failure to detect major changes of trend and their models which seem to underestimate the impact of changing tax rates on behaviour make these forecasts difficult to rely on.
March 15, 2023
Yet again vocational training is missing again. The amazing industry sector training that Blair demolished. This needs to be revisited & reduce useless degree courses. The NHS used to have a great training model for all levels of education. Progression to all from Auxiliaries, through to SENs & SRNs.
There are many who do not want or need to do degree courses & businesses who need workforce now. Technical & Adult colleges scrapped. To get over 5Os back to work, training & employment needs to be local & flexible
March 15, 2023
RIP the non tory party
A budget for growth my arm.
March 15, 2023
Ewan Blair is making his fortune reversing his fathers work. Does not seem to require funding.
March 16, 2023
Nurses need to know how to write academic papers , to make cases in order to protect themselves from other professions who can foresee the demise of their own profession as Nursing standards are lifted medically higher and higher. Is not just about the patient ( and in a simpler world it would be) but rather competition and doing the same work with added experience and basic groundings in Healthcare. We need highly practically orientated Registered medics and surgeons but we don’t want to pay high amounts of money for the sake of a grace and favour title with just a few years training rather than 20 years or more of continuing professional learning.. The title Nurse is a long standing professionally certificated and registered title . The registered medics title ,Dr, does not exist . It is simply a snob value title which some look to as being better , because of that title . Shallow thinkers continue.
March 15, 2023
I thought today that Labour produced a reasonable budget
March 15, 2023
‘There are three government economic aims to halve inflation, ensure growth and have falling debt levels in the medium term. ‘
A fair approach if you want to appear successful in the run-up to a GE. However, the horse has bolted, the Red Wall collapsed, lack of accountability, sleaze and jobs have indeed been produced for friends. Inflation caused and wanted(?) by this Government, growth dead and last rites all but read out loud, falling debt – not a chance for the people of this country locked into high cost of living, alarming mortgage interest rates and no help in short to medium term. Medium term an amusing thought, perhaps Hunt thinks Starmer will tackle debt rather better than the present? Perhaps medium term means the 6 month period before the next GE? Jam tomorrow, yeah right.
March 15, 2023
Oh, “we” are short of employees, are we?
Might that just be because “we” told the most positive, energetic, and costlessly fully trained, from the most advanced, civilised 27 countries on Earth to shove off?
March 15, 2023
But 6 million were told would you like to stay here? And they said YES and signed up.
Ask your GP, although I know this is an impossibility for many millions, if you can have a memory test. Yours keeps going walk-about.
March 15, 2023
Ship in 9 million so that 9 million don’t have to work.
No wonder the tax burden is so high.
March 16, 2023
That would not be the failing bloc which now accounts for 15% of world trade and falling?
They are hanging onto that by spending £500 million a month on Russian gas – but calling it by another name.
People who can’t think straight and fact facts and truths never succeed.
March 15, 2023
Although this point conflicts with my personal interest (I am landlord of a small children’s nursery that closed last year) in furtherance of the public interest I will state this.
The overwhelming majority of mothers of children aged 9 months to 3 years are already working and probably at least half of those not working could not be persuaded to work. Although I do welcome the slight loosening of the staff-child ratio (which is still very uncompetitive anyhow with the ratio in primary school reception classes which is a prime reason why the nursery I was landlord of closed), the expense of public taxation paying for over 2 years extra nursery provision for everybody will be colossal and permanent in relation to getting the government’s estimated 60,000 mothers into work, which may not even be needed if there is a recession. Better by far to reduce those needing to go to work by reducing governmental regulations and bureaucracy, thereby in creasing efficiency and national competitiveness.
March 15, 2023
Seems to have spent more than Kwasi Kwarteng was proposing.
Because it is targeted at business rather than taxpayers the markets have welcomed it.
We was robbed in October
March 16, 2023
@NS; Perhaps, but if one spooks the markets expect to be caught by the back-wash!
Truss/Kwarteng moved much to fast, history might well be quite different had there been a more measured Autumn statement (and certainly not the out-of-course ’emergency’ budget Kwasi delivered…), waiting until the March Budget to do the heavy lifting. A self inflicted political disaster.
March 16, 2023
Do you mean the 81,000 plus EU nationals on the dole in the UK today ,when did they shove off ??
March 16, 2023
So you are not counting the ‘asylum seekers who ALL come from the EU?
JR it would be helpful to know how much is spent on immigrants (including those who have become citizens). What is the net profit from this Market in Citizenship that the political class set up?