Philip Hammond says 'best days are ahead of us' as he pledges public spending boost

Posted On: 
13th March 2018

Philip Hammond today told Britain “the best days are ahead of us” as he pledged a funding boost for public services later in the year.

Philip Hammond delivered his Spring Statement in the Commons today
Credit: 
Parliament.TV

Delivering his Spring Statement, the Chancellor said there was “light at the end of the tunnel” as he unveiled slightly better than expected short-term growth figures.

And in a bid to present himself as upbeat about the fiscal landscape, he mocked his apparent likeness to Eeyore, the gloomy donkey from Winnie-the-Pooh.

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“If there are any Eeyores in the chamber, they are over there - I meanwhile am at my most positively Tigger-like today," he declared.

Updated figures from the independent Office for Budget Responsibility revised expected growth up over the next couple of years - but down in the early 2020s.

Growth is set to rise to 1.7% in 2017, up from the previous forecast of 1.5%, and 1.5% next year, up from the November forecast of 1.4%, according to the fiscal watchdog.

It is then set to be 1.3% in 2019 and 2020 - unchanged from previous forecasts - but reach 1.4% in 2021, down from 1.5% since November, and 1.5% in 2022, down from 1.6%.

The Chancellor said the slightly improved figures meant he could boost public services at the Autumn Budget, insisting: "I do not agree with those who argue that every available penny should be used to reduce the deficit.”

He added: “I can confirm that at this year's Budget I will set an overall path for public spending for 2020 and beyond with a detailed spending review in 2019...

“In accordance with our balanced approach I would have capacity to enable further increases in public spending and investment in the years ahead."

And he declared that the UK boasted "an economy where prosperity and opportunity are in reach of all, wherever they live, whatever their gender, colour, creed or background".

He went on: "Where talent and hard work alone determine success. A beacon of enterprise and innovation. An outward looking free trading nation.

"One that is confident that our best days lie ahead of us. A force for good in the world."

But IFS boss Paul Johnson Tweeted witheringly: “These are not encouraging forecasts.”

 

 

The OBR said the deficit is set to come in at £5bn lower this year than it expected in November.

But it added: “The economy has slightly more momentum in the near term, thanks to the unexpected strength of the world economy, but there seems little reason to change our view of its medium-term growth potential.”

Borrowing is on course to reach 0.9% in 2022/23 and is set to be used only for long-term capital spending in 2018/19, Mr Hammond said.

And the public debt is set to peak at 85.6% of GDP in 2017/18, then fall every year to reach 77.8% in 2022/23.

PUBLIC SERVICES 'IGNORED AGAIN'

Shadow Chancellor John McDonnell told his counterpart: "His complacency today is astounding.

"We face – in every public service – a crisis on a scale we’ve never seen before.

"Hasn’t he listened to the doctors and nurses, the teachers, the police officers, the carers and even his own councillors?

"They are telling him they can’t wait for the next Budget. They’re telling him to act now.

"For eight years they’ve been ignored by this government. And today - they’ve been ignored again."