Prime Minister Rishi Sunak’s spring declaration could be a difficult balancing act as he faces calls to increase defense spending and introduce measures to reduce the cost of living.
Sunak is scheduled to release its spring report on March 23, along with the latest Office of Budget Responsibility (OBR) projections, published twice a year.
The OBR is “widely expected to upgrade its projections”, giving the prime minister the option to “increase public spending while staying within its limits” after the Treasury received its tax receipts in January. 2022 is nearly 9 billion pounds more than the previous year, said. Sky News.
Equal walkie talkie explains, the spring declaration is “an opportunity for the Prime Minister to update on the general state of the economy”, but is unlikely to include any “major changes in taxes or spending”, saved for Budget, given once a year. .
The Spring Declaration can be likened to a “Mini Budget” and “tends to include the kick-off of some consultations on potential new policies.”
Increase defense spending
Sources told the broadcaster any increase in spending was mostly directed towards defense purposes, with “additional amounts for lethal aid to Ukraine“As well as an increase in other areas of the defense budget” in the face of the growing threat to NATO from Russia “.
There hasn’t been any formal submission from the Department of Defense yet, but Labour’s shadow Defense Secretary John Healey said he expects a “major boost to defense” in the spring statement. .
“The government has to respond to growing threats and growing threats to our security in Europe,” he told Trevor Phillips on Sunday.
Call for tax cuts and cost of living
The PM is likely to find himself under pressure to alleviate the looming cost of living crisis through “Covid-level intervention” to save energy markets from disaster, Politico said London Playbook.
He could face pressure from Boris Johnson to “provide new help to households” amid fears that inflation could rise to 7% in May, reports Financial Times (FT).
One minister predicted that Johnson would “request short-term help for families facing higher fuel and food prices” as Russian sanctions hit Britain’s energy supplies, newspaper said. Sunak has announced a £9 billion package to help households tackle the rising cost of their energy bills, in the form of reimbursable and one-time discounts on council tax strips. from A to D.
Many Tory MPs, such as Brexit Opportunity Minister Jacob Rees-Mogg, are likely to “push the case” for tax cuts, including reversing the planned National Insurance increases. , which will fund NHS treatments and social care. Calls for the repeal of the planned new tax rate are supported by many Conservatives and Labor parties.
But Sunak was “determined to resist such pressure”, the paper said, “and has so far been backed by Johnson”. The Prime Minister is concerned about the “artificial” injection of money into the economy through measures such as canceling the planned tax increase, “fearing it could push inflation even higher”, the FT explained.
Freeze gasoline tax
The Prime Minister found himself under pressure from campaigners to cut fuel tax by 5p in his spring statement, a move backed by Robert Halfon and other senior Tory MPs.
Motorists have begun to feel that the price of sanctions against Russia at the gas pumps is the price of crude rockets. Gasoline rose 4p a liter last week to £1.55 at the weekend, making the price of a gallon £7 higher, while diesel rose 6.5pa litres to £1.61, or £7.30 a litre. gallons.
Experts have warned that “prices could continue to rise” said Sunas “global instability and tight sanctions on Russia continue to drive crude oil prices higher.”
Halfon told the FT that ministers had warned that fuel tax cuts would mean tax cuts would not be possible by the end of the year, but Halfon argued: “If pump prices go up 1 £60, not only motorists but businesses and the NHS are affected. ”
https://www.theweek.co.uk/news/uk-news/956023/predictions-for-rishi-sunaks-spring-statement Predictions for Rishi Sunak’s Spring Proclamation