– Brexit budget – Grim outlook as UK economic forecasts downgrade
– UK Chancellor uses housing market policy as smoke-screen for deteriorating economy
– UK budget matters more than ever due to BREXIT risks
– Policy on stamp duty will fail to aid worsening housing market
– Real GDP expected to grow by just 1.5%, 40% less than projections 2 years ago
– Households now face an unprecedented 17 years of stagnation in earnings
– Critics claim Budget failed to calm Brexit uncertainty
– UK and especially London property market at “breaking point”
Editor: Mark O’Byrne
Yesterday UK Chancellor Philip Hammond’s long-awaited Autumn Budget was delivered to the Houses of Parliament. He was praised for a ‘good budget in political terms’ and for talking up the UK economy, telling his contemporaries that that it is “confounding those who talk it down” and that “those who underestimated the UK, do so at their peril”.
Hammond’s comments suggest the economy is doing better than its critics said it is. This isn’t the case. The Office of Budget Responsibility (OBR) delivered some depressing statistics yesterday which suggest the recovery post-crisis and post-referendum is still a long way off.
Hammond was praised for his ‘cheery’ budget. His head had been very close to the block ahead of yesterday with many criticising his negative views on Brexit negotiations and general lack of optimism.
In reality this really was a political budget. One designed for some quick-wins and support from the House and the media. It was hardly economic. Brexit was barely addressed, economic growth was referred to as ‘stubborn’ and the housing market was treated with a patronising cut in stamp duty. A band-aid on a haemorrhaging artery.
Is the UK economy proving its critics wrong?
The government statistics agency cut the UK’s projected growth forecast for 2017 from 2% to 1.5%. The OBR believes the economy can only now grow sustainably at a rate of 1.5 per cent, 40 per cent lower than it estimated as recently as two years ago.
On an international level we are expected to fall down the leaderboard of G7 countries in 2017 and into 2018. Just last year we were second only to Germany in terms of growth. Data from both the OBR and the IMF suggest lower forecasts for the UK’s GDP and output.
This does not bode well for workers who have not only failed to see their wage levels increase for nearly a decade but are also worried about the impact of Brexit.
Brexit boost?
Hammond was praised for drawing attention away from the ongoing Brexit-saga. He mentioned the allocation of a further £3bn to help any outcome of the talks. For London May Sadiq Khan this was not enough:
“At a time when there’s uncertainty, at a time where we are being told by the EU we’re going down the road of an extreme, hard Brexit because of the response of this Government, businesses will think ‘you know what? We’re far better going off to Frankfurt, or going to Berlin, or going to Paris.
“This is not me talking down London, it’s me being frustrated by this budget today. This, I think, is the most anti-London budget for a generation.
“…At a time when businesses are frustrated by the lack of Londoners with the skills for the jobs of tomorrow, no rule news in relation to investing in young Londoners.
“This was a chance for the Chancellor to have a big, bolder budget. He’s blown it.”