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Hughes told a Lords committee last month:
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Some people call [the projections] But if someone goes out of their way to write a work of fiction, and the government doesn’t bother to write down the spending plans for each department on which its public service plans are based, it’s probably being generous.
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When asked about the comments, hunt Said:
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Those words are wrong and should not have been said.
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The government decides on spending plans and spending reviews.
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The next Spending Review will begin in April 2025, but of course no spending plan will be published until the Spending Review is complete. No government has ever done that before.
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Good morning. Labour is holding a business conference today, with tickets going at £1,000 a time to executives who want to learn how a Keir Starmer government might handle the economy. According to a press release overnight, 400 senior business leaders are attending, and tickets sold out within four hours. Keir Starmer and Rachel Reeves, the shadow chancellor, are both speaking.
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But this morning it is Jeremy Hunt, the chancellor, making the news, with a declaration that his scope for tax cuts in the budget may be limited. In an interview with the BBC’s Nick Robinson for his Political Thinking podcast, Hunt said:
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It does not look to me like we will have the same scope for cutting taxes in the spring budget that we had in the autumn statement.
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And so I need to set people’s expectations about the scale of what I am doing because people need to know that when a Conservative government cuts taxes we will do so in a responsible and sensible way.
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But we also want to be clear that the direction of travel we want to go in is to lighten the tax burden.
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Earlier this week the Times reported that Hunt delivered this message to cabinet. In their report, Mehreen Khan and Steven Swinford said Hunt told colleagues there would be less headroom for tax cuts than in the autumn statement and that relatively low levels of productivity in Britain were “our major structural weakness”. Asked about the report on ITV’s Peston show last night, Hunt said:
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As things stand at the moment, things can change, it doesn’t look like I’ll have the kind of room I had for those very big tax cuts in the autumn, and I did mention that to the cabinet, yes.
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This may, of course, just be expectation management. In September last year Hunt said that tax cuts would be “virtually impossible” in the light of economic circumstances as they were then. Two months later, in the autumn statement, he announced tax cuts worth £20bn.
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But, in assessing what politicians say, it is always worth starting with the assumption that they might be telling the truth, and it would not be surprising if Hunt has concluded that he cannot afford massive tax cuts – because that is exactly what mainstream economists are saying. Only this week the IMF suggested Hunt would not be able to reduce taxes without public spending being cut to an unacceptable level.
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It is also worth pointing out that there is a huge difference between ruling out “very big tax cuts”, and ruling out any tax cuts. There were two main tax cuts in the autumn statement: a cut of 2p in the pound from national insurance, costing £9bn in 2024-25; and full expensing, a tax cut for business worth £11bn a year by 2027-28.
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For electoral reasons, Hunt is expected to focus on personal tax cuts in the budget and he could still do quite a lot on that front without matching the £20bn splurge from last autumn.
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Here is the agenda for the day.
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10am: Rachel Reeves, the shadow chancellor, gives a speech and holds a Q&A at Labour’s business conference.
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10am: Rishi Sunak holds a meeting in Downing Street to mark the creation of a new small business council.
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11.30am: Downing Street holds a lobby briefing.
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After 11.30am: MPs hold two 90-minute debates on the two regulations being passed to implement the reforms to the Northern Ireland Windsor framework announced yesterday.
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12pm: Humza Yousaf, Scotland’s first minister, takes questions at Holyrood.
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2pm: Keir Starmer gives a speech and holds a Q&A at Labour’s business conference.
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If you want to contact me, do try the “send us a message” feature. You’ll see it just below the byline – on the left of the screen, if you are reading on a laptop or a desktop. This is for people who want to message me directly. I find it very useful when people message to point out errors (even typos – no mistake is too small to correct). Often I find your questions very interesting, too. I can’t promise to reply to them all, but I will try to reply to as many as I can, either in the comments below the line; privately (if you leave an email address and that seems more appropriate); or in the main blog, if I think it is a topic of wide interest.
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important events
Mr Hunt criticizes OBR chief Richard Hughes’ long-term spending forecasts, calling them ‘fiction’
In an interview with BBC’s Nick Robinson, jeremy huntthe prime minister criticized Richard Hughesthe head of the Office of Budget Responsibility, criticized Treasury’s long-term public spending forecasts as worse than “fiction”.
Mr Hughes told the Lords Committee last month:
Some people call [the projections] But if someone goes out of their way to write a work of fiction, and the government doesn’t bother to write down the spending plans for each department on which its public service plans are based, it’s probably being generous.
When asked about the comments, hunt Said:
Those words are wrong and should not have been said.
The government decides on spending plans and spending reviews.
The next Spending Review will begin in April 2025, but of course no spending plan will be published until the Spending Review is complete. No government has ever done that before.
Jeremy Hunt suggests tax cuts in Budget will not match last year’s £20bn in benefits
good morning. Labor is holding a business conference today and is offering tickets for £1,000 each to executives who want to find out how Keir Starmer’s government will deal with the economy. Last night’s press release said 400 senior business leaders attended and tickets sold out within four hours. Keir Starmer and the shadow chancellor Rachel Reeves are speaking.
But this morning it is. jeremy hunt, the Chancellor made news by declaring that the scope of tax cuts in the Budget may be limited. In an interview on the BBC’s Nick Robinson’s Political Thinking podcast, Mr Hunt said:
I don’t think there is room for the same tax cuts in the spring budget as there was in the autumn statement.
So I have to set expectations for people about the scale of what I’m doing. Because if a Conservative Government cuts taxes, people need to know that we will do so in a responsible and sensible way.
But I also want to be clear that the direction we want to go in is to reduce the tax burden.
Earlier this week, The Times reported that Mr Hunt had conveyed this message to ministers.in their reportMehreen Khan and Stephen Swinford said Mr Hunt told colleagues there would be less scope for tax cuts than in his autumn statement, and said the UK’s relatively low productivity levels were “a major structural weakness in our country”. ”. Asked about the report on ITV’s Peston program last night, Mr Hunt said:
At this time, the situation may change. There doesn’t seem to be enough room for very large tax cuts in the fall. I conveyed this to the Cabinet. yes.
Of course, this may just be expectation management. Last September, Mr Hunt said he would cut taxes. “Virtually impossible” Considering the economic situation at the time. Two months later, in the Autumn Statement, it announced tax cuts worth £20bn.
But when evaluating what politicians say, it’s always worth starting with the assumption that they might be telling the truth, and it’s no surprise that Mr. Hunt concludes that he can’t cut taxes on a large scale. That’s exactly what mainstream economists think. Say. Only this week did the IMF suggest to Mr Hunt that he would not be able to cut taxes without cutting public spending to unacceptable levels.
It’s also worth pointing out that there’s a big difference between excluding “very large tax cuts” and excluding all tax cuts. The autumn statement included two main tax cuts. One is a 2p tax cut from National Insurance, which will cost £9bn in 2024-25. And by 2027-28, we will fully spend the £11bn a year worth of business tax cuts.
For electoral reasons, Mr Hunt is expected to focus on personal tax cuts in his Budget, and there is a chance he could do quite a bit in this area without matching last autumn’s £20bn splurge. There is.
The agenda for the day is:
10 am: Shadow Chancellor Rachel Reeves will speak and answer questions at Labour’s business conference.
10 am: Rishi Sunak holds a meeting in Downing Street to mark the establishment of the new Small Business Council.
11:30am: A lobby briefing session will be held at Downing Street.
After 11:30am: MPs held two 90-minute debates on two regulations passed to implement Northern Ireland’s Windsor Framework reforms announced yesterday.
12pm: Humza Yousaf, Scotland’s first minister, is questioned on Holyroodhouse.
2 pm: Keir Starmer speaks and answers questions at Labour’s business conference.
If you would like to contact me, please try the “Send Message” feature. If you are reading on your laptop or desktop, it will appear just below the signature line, on the left side of your screen. This is for those who want to send messages directly. I find it very helpful to have people point out mistakes (including typos) in messages. No mistake is too small to be fixed. I often find your questions very interesting as well. I can’t promise to reply to everything, but I’ll do my best to reply in the comments section below that line. Privately (if you feel it is appropriate to leave your email address). Or on your main blog if you think it’s a topic of widespread interest.
