Chancellor Philip Hammond has announced that he will deliver the Autumn Budget on Wednesday 22 November.
The Autumn Budget will be the second Budget to be delivered this year, and will set out the government’s plans for the UK economy, based on forecasts from the Office for Budget Responsibility (OBR).
It will also outline any tax changes and spending plans for the new tax year.
Mr Hammond stated that the government intends to set its thinking on ‘how to keep the economy strong and resilient and fair’ in order to create ‘an economy that works for everyone’. The Chancellor recently told the Economic Affairs Committee that the UK economy has been ‘overshadowed by the uncertainty of the Brexit negotiation process’.
The 2017 Autumn Budget will be the first of its kind under the government’s new fiscal timetable: during the 2016 Autumn Statement, the Chancellor revealed that the annual Budget will now take place in the Autumn, as opposed to Spring.
Going forwards, Mr Hammond will make a Spring Statement each year, responding to a forecast produced by the OBR.
The first Spring Statement will be delivered in 2018.
A report published by the Institute for Public Policy Research (IPPR) has suggested that the UK’s economic model requires ‘radical reform’.
Living standards for the ‘majority of the population’ are no longer rising, the IPPR’s Commission on Economic Justice discovered. It also found that the UK is in the midst of the ‘longest period of earnings stagnation for 150 years’, with young people set to be ‘poorer than their parents’.
Productivity in the UK is 13% below the average for the richest countries in the G7, the report highlighted.
In addition, a ‘fiscal gap’ is growing between tax revenues and expenditure, which the IPPR believes will worsen as workers age and the proportion of employees declines.
The IPPR stated that the British economy needs ‘fundamental reform’, and has called for a debate on taxation, the role of the UK’s financial sector, the dominance of digital companies in their marketplace and the power held by UK trade unions.
Tom Kibasi, Director of the IPPR and Chair of the Commission, commented: ‘The British economy needs fundamental reform. We don’t have a British economic model. We have an economic muddle. The persistent economic problems we have experienced since the 2008 financial crash won’t be fixed with a bit of tinkering.
‘There is a growing consensus across business, trade unions and civil society that a radical new approach is now needed. Change should be guided by a new vision for the economy, where long-term prosperity is joined with justice for all.’
A survey carried out by the Recruitment and Employment Confederation (REC) has suggested that employer confidence in the UK economy has moved into negative territory as a result of ongoing Brexit and political uncertainties.
The REC’s JobsOutlook Survey, which polled 601 UK employers, revealed that employer confidence has fallen from +6% in July to -3 this month.
It found that 31% of employers expect the UK economy to worsen, and just 28% expect it to improve.
In addition, 40% of employers interviewed stated that they have ‘no spare capacity’, and would need to recruit to meet additional demand. Many of those surveyed also expressed concerns over a ‘lack of appropriate candidates’ for construction jobs.
Kevin Green, Chief Executive of the REC, stated: ‘Businesses are continuing to hire to meet demand, but issues like access to labour, Brexit negotiations and political uncertainty are creating nervousness.
‘The jobs market is in a good place but employers will only continue to hire and invest if they feel assured about the future.’
The Bank of England (BoE) has warned that a significant rise in personal debt could ‘pose a danger to the UK economy’.
The Bank revealed that car loans, credit card balance transfers and personal loans have increased by 10% over the past year, whereas household incomes have risen by just 1.5%.
High street banks are at risk of entering a ‘spiral of complacency’ during a period of good economic performance and low loan issues, the BoE also suggested.
It warned that as the spiral continues, borrowers risk accumulating ‘more and more’ debt.
The BoE stated that it may urge banks to implement further safeguards against the risk of bad debts.
Commenting on the rise in personal debt, Alex Brazier, Financial Stability Director at the BoE, said: ‘Household debt – like most things that are good in moderation – can be dangerous in excess. Dangerous to borrowers, lenders and, most importantly from our perspective, everyone else in the economy.’
The International Monetary Fund (IMF) has downgraded the UK’s growth forecast for 2017 from 2% to 1.7%.
It attributed the downgrade to the UK’s weaker-than-expected economic performance in the first three months of this year.
However, growth forecasts for France, Germany, Italy and Spain have been revised upwards.
The latest IMF forecast is just below the Bank of England’s: the Bank predicts that the UK economy will grow by 1.9% this year.
Meanwhile, UK growth forecasts for 2018 remain unchanged at 1.5%, the IMF revealed. Global economic predictions for next year also remain the same, with the IMF anticipating global growth of 3.6%.
Commenting on the downgrade, a Treasury spokesperson said: ‘This forecast underscores exactly why our plans to increase productivity and ensure we get the very best deal with the EU are vitally important.
‘We will continue to deliver greater prosperity and higher living standards for hard working people across the country.’
The UK economy experienced the weakest rate of growth in the EU during the first quarter of this year, figures published by European statistics agency Eurostat have suggested.
Britain’s economy grew by just 0.2% in the three months to March – a significant fall from the rate of 0.7% recorded during the last quarter of 2016.
Experts believe that Brexit was partly to blame for the UK’s low economic growth rate, alongside rising prices due to lower sterling.
The data also revealed that growth for the EU as a whole totalled 0.6% in the first quarter of 2017. It found that the French economy grew by 0.4%, whilst German economic growth rose by 0.6%.
Economists expect Britain’s Gross Domestic Product (GDP) rate to rise slightly in the coming months.
The UK economy is set to grow by 1.6% by the end of 2017, as predicted by the Organisation for Economic Co-operation and Development (OECD). However, the OECD also expects UK economic growth to fall to 1% during 2018, as Brexit looms.
A snap poll carried out by the Institute of Directors (IoD) has found that, following the General Election and the subsequent Hung Parliament, business confidence in the UK economy has ‘fallen dramatically’.
The poll of 700 IoD members revealed that businesses require ‘rapid agreement’ on transitional arrangements that arise from Brexit talks, alongside clarity as to whether EU nationals already residing in the UK will be permitted to remain in the country following Brexit.
Businesses also have ‘no desire’ for another election this year, the poll suggested.
The IoD has called for the government’s main priority to be striking a new trade deal with the EU.
It also warned that political uncertainty generated by the election could have ‘disastrous’ consequences for the UK economy.
Stephen Martin, Director General of the IoD, said: ‘The needs of business and the discussion of the economy were largely absent from the [General Election] campaign, but this crash in confidence shows how urgently that must change in the new government.’