On Thursday the Office for Budget Responsibility (OBR), the government’s independent fiscal watchdog, published its latest annual report on the long-term sustainability of the public finances and the fiscal risks facing the UK. This made for grim reading, as these reports always do. But this time, the report has been widely interpreted as a warning … Continue reading Is the OBR right to warn against tax cuts?
The latest data on the UK’s public finances have provided more ammunition for those arguing that the government cannot afford to cut taxes. However, the economic reality is far more nuanced – especially when it comes to debt interest payments. The bad news is that the government borrowed another £14.0 billion in May, £3.7bn more … Continue reading Is the Treasury ‘crying wolf’ over the debt interest bill?
In his Spring Statement speech the Chancellor made the eye-catching claim that ‘in the next financial year, we’re forecast to spend £83 billion on debt interest’. This £83 billion figure was widely understood to be the amount that the government would actually pay out in interest in 2022-23. This has prompted lots of unfavourable comparisons … Continue reading Is the UK government really about to spend £83 billion on debt interest?