The Chancellor's Autumn Statement & Spending Review
"The Chancellor’s delivery of the Autumn Statement and Comprehensive Spending Review contained much of the political bravado that we have come to expect from him."
Christian Spence, Head of Research & Policy at Greater Manchester Chamber of Commerce
Listen Again to Christian's Analysis
Key Points at a Glance
- There has been a £27bn improvement in the UK's public finances, allowing Mr Osborne to "fix the roof while the sun is shining"
- The Chancellor has pledged to spend £12bn on infrastructure, to "build the infrastructure our country needs"
- The Government will borrow £73.5bn in the current fiscal year. It will then drop to £49.9bn, to £24.8bn in 2017/18, and to £4.6bn in 2018/19
- The budget will need move into a surplus in the 2019/20 year, of £10.1bn, rising to £14.7bn in the next year
- Government borrowing will be £8bn over the whole period than had previously been planned
- Debt will fall as a percentage of GDP this year, and in each of the subsequent four years, according to Office for Budget Responsibility (OBR) forecasts
- The national debt will stand at 82.5pc of GDP this year
- Tax credits will now remain unchanged, after Mr Osborne's nose was bloodied by a vote against planned cuts in the House of Lords
- The Chancellor's plans would have saved £4.4bn, but were met with fierce opposition
- As a result the Government will breach its own welfare cap
- The first Comprehensive Spending Review since 2010 "sets out far reaching changes to what the state does and how it does it"
- There is £450m more for digital services, while the total cost of Whitehall administration will fall by £1.9bn
- Chancellor says that Government spending will continue to rise throughout this government, in nominal terms
- Total managed expenditure will stand at £756m this year, rising to £773m next year, and then to £787m
- Spending will then climb further on that measure, to £801m in 2018/19, then £821m in 2019/20, and finally at £857m in 2020/21
- Day to day spending of Government departments is set to fall by 0.8pc each year in real terms for the remainder of the parliament
- Funding for the business department will be cut by 17pc. Spending at the Department for Transport will drop by 37pc
- Spending at the deparmtents of environment and energy will reduce their spending by 15pc and 22pc respectively
- There will be real-terms protection of police funding
- The defence budget will rise from £34bn to £40bn. The armed forces will be expected to pool resources to make efficiency savings
- UK expected to grow by 2.4pc this year, then 2.4pc in 2016 and 2.5pc in 2017. Subsequently 2.4pc in 2018 and then 2.3pc in both 2019 and 2020
- The growth forecasts for 2016 and 2017 were revised up, by 0.1 percentage points each
- No economy in the G7 has grown faster than the UK in any year since 2010, the Chancellor says
- Expectations for world growth have been revised down, on concerns about persistent weakness in the eurozone, and rising debt in emerging market economies
- The OBR believes that the UK will create 1m jobs over the next five years. The Conservative manifesto had promised to create 2m more jobs
Source: The Telegraph