What to expect from the Spring Statement
Despite being billed as a lower-profile fiscal event, the Spring Statement could be significant for business.
The Spring Statement on 13 March marks the advent of a new fixture on the political calendar – albeit with a different feel.
Delivering his first Autumn Statement in November 2016, Chancellor Philip Hammond adopted a playful tone as he announced he would be moving to once major fiscal event a year from 2018 – a shift the CBI has long advocated to increase stability in the tax system.
In-keeping with Mr Hammond’s desire to take a longer-term and more holistic approach to policymaking, the Chancellor is expected to provide an update on the state of the public finances and the UK’s economic outlook rather than announce significant changes to the government’s tax and spending plans.
Encouragingly for the Chancellor, figures released last month by the ONS for January 2018 show public sector borrowing decreasing, with UK borrowing for the year to date at its lowest level since the financial crisis. This could mean that the government’s fiscal watchdog, the Office for Budget Responsibility, will revise down its forecast for 2017/18 borrowing, which would be welcome news for the Chancellor ahead of Spring Statement but more importantly Autumn Budget later this year.
Alongside these fiscal updates, the Chancellor’s speech is also expected to announce a series of consultations in areas of reform the Treasury are interested in ahead of the Budget in the autumn. Possible consultations include artificial intelligence, automation and taxation in the digital economy.
For more information please contact Fiona.Geskes@cbi.org.uk.