Everything we learned about Jeremy Hunt’s ‘sensible’ budget from Sunday’s interview

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Prime Minister Jeremy Hunt gave his annual pre-statement speech on Sunday news programs as the government prepares to unveil last spring’s budget ahead of the general election.

Mr Hunt is widely expected to consider tax cuts and seek minimal increases in public spending as the Conservatives make a last-ditch effort to win back voters.

However, recent OBR forecasts show the Chancellor has less room to cut taxes than previously thought, leading to him dampening expectations about the type of cuts people can expect.

Here’s a look at everything else the Chancellor has hinted is likely to be included in Wednesday’s Budget.

the government developed the economy

The Prime Minister can be expected to say the government has made good progress on the economic front, pointing to the containment of inflation and the downgrading of the “technical” recession.

Speaking on the BBC’s program with Laura Kuenssberg, Mr Hunt said inflation had fallen from 11% when Rishi Sunak became chancellor to its current level of 4%, telling Mr Kuenssberg: “People “It’s falling much faster than we expected.”

Despite the UK officially entering a technical recession last month, Mr Hunt said the recession was “much healthier” than the Bank of England had previously thought.

He added that the economy is “much more resilient than people expected.”

Drastic tax cuts are not possible

Although the Chancellor is a keen supporter of tax cuts, he has made it clear that the Government will not commit to radical tax cuts and has been keen to manage expectations about the types of cuts expected.

talk to Sky News Sunday Morning Mr Hunt, along with Trevor Phillips, said:

“When it comes to tax cuts, I believe that if you look around the world, countries with lower taxes, such as North America and Asia, tend to grow faster. So in the long term, we will become a developed country again. I think we need to go back to an economy with lower taxes and less regulation.”

But he warned:

“It would be extremely unconservative to increase borrowing and cut taxes without allocating sufficient financial resources.

“If you think back to the great tax cut budgets of the past, Nigel Lawson’s budget in 1988, the reason it was so important is because those tax cuts were permanent.

“This is a tax cut that we can really afford, and people need to know that everything I do responsibly will be done at an affordable price.”

Although the prime minister did not say specifically what kind of tax cuts the government is considering, there is a widespread view that further tax cuts may be introduced in national insurance taxes and income taxes.

Jeremy Hunt described the 2p cut to National Insurance in his Autumn Statement as a “turning point” and said he wanted to “make some progress” on tax cuts.

talk to sky news “All conservatives believe that the state has a moral obligation to keep as much money as possible in people’s pockets because it belongs to the people who earned it,” he said. said.

Fiscal rules are here to stay

Jeremy Hunt has insisted fiscal rules will remain, despite opposition from former Bank of England chief economist Andy Haldane.

Sustainable investment rules aim to keep debt at levels that are not unsustainable or unfair to future generations.

Haldane said: BBC He said he wanted to hear that “the fiscal rules could be adjusted” because “we’re seeing incredible growth for me right now.”

He explained that the government’s own self-imposed restrictions on debt are “constraining our ability as a nation to invest and therefore our ability to grow tomorrow.”

But Mr Hunt insisted he would not change the fiscal rules because “I think people will interpret this to mean the UK has lost control of its finances”.

he said this BBC: “The reason we have them is to give confidence to the British people and to the world that we are a country that pays back its debts. And if we didn’t have them, people will worry that Britain will continue its never-ending debt binge.”

“There are no gimmicks.”

Mr Hunt insisted his budget would be “responsible” with a focus on long-term economic growth plans.

In response to a question from Mr. Kuenssberg about whether Mr. Hunt was considering abolishing the non-national tax system to finance the small tax cuts, the Prime Minister said that the country “sees through the tricks, and on Wednesday we will I have no intention of doing so.”

Mr Hunt did not rule out stealing Labour’s policies, but suggested that any measures taken would be long-term policy rather than short-term solutions.

Freeing up money by focusing on the “productivity” of public services

The government has already announced that it will work to “improve public sector productivity” to improve services without increasing government spending.

The announcement includes a number of cost-cutting measures, including the introduction of artificial intelligence and digitalisation across government and the creation of 200 more children’s social care homes in the UK.

Elaborating on this morning’s announcement, Mr Hunt told the BBC: “We have to think not about the money we put into it, but whether we can do things more efficiently to make more money.” Told.

Mr Hunt has previously suggested the government will not tackle big public sector spending programs, instead freeing up funds by eliminating waste in Whitehall and focusing on improving productivity and efficiency. are doing.

Increases in public spending will be kept to a minimum

Despite public services being under pressure, Mr Hunt insisted the government would not commit to a major public sector spending programme.

The Prime Minister told the BBC he did not believe in “extending the welfare state forever” because “I don’t think it is compatible with lowering the tax burden in a society where people are paid for their work”.

The left-wing think tank the Resolution Foundation warned last month that the chancellor’s current spending forecasts mean a 1% increase in daily spending on public services is a “fiscal fiction”.

The report says that, given that health, education and defense budgets are all protected, unprotected sectors such as the Home Office, Justice and Local Government will be cut by 17% per capita by 2028-29. explained.

Mr Hunt told Times Radio: “It’s a fallacy that the only way to improve public services is to spend more money.”

Asked if the government would not spend more, Mr Hunt said: “That’s the wrong question”, but declined to answer specifically whether public services were currently in good shape.