The Spring Statement 2018…or a Spring Clean?14 March 2018
Our Chancellor, Philip Hammond MP, stood at the despatch box at lunchtime on 13 March 2018 to deliver the new style Spring Statement. Those who find any Budget type announcements a bore could quote the longest recorded Budget speech, by William Gladstone in April 1853, which lasted 4 hours and 45 minutes. The shortest was Benjamin Disraeli in April 1867 at 45 minutes, only just beating Gordon Brown at around the same length of time in 2005. This not being a Budget, just a Spring Statement, lasted approximately 26 minutes and as you can guess from the length of time taken, there was little to remark upon. It was a response to the OBR's findings, rather than announcing changes to financial planning allowances and parameters, but some of the headlines provided a view of the UK's financial health. We have listed a few below:
- UK growth forecast to be 1.5% this year, slightly higher than projected by the OBR in November 2017. The forecast for 2019 and 2020 remains unchanged at 1.3%
- Debt forecast to fall as a share of GDP from 2018/2019, to a level of 77.9% by 2022/2023
- Inflation to fall back to the Bank of England's target rate of 2% by the end of 2018
- A suggestion of possible spending increases to be announced in the Autumn Budget, with a detailed spending review in 2019
- Consultations on a range of future policies, including a possible tax on single use plastics, a new strategy for taxing global tech giants and a consultation on the future of cash and digital payments
- Further funding for apprenticeship places
- Additional funding for affordable homes in some regions, including London
As an interesting aside, the OBR's background papers confirm that the final amount that the UK expects to pay to separate from the EU is 41.4bn euros (£37.1bn).
The relatively light touch of this Statement reflects the nature of this lesser speech, with the major changes and announcements expected in the autumn months, usually October/November. We will of course keep you posted on the date of the Autumn Budget when announced and the changes that follow.
No individual advice is provided during the course of this blog and if you would like to discuss your financial planning then please contact the team at Chapters Financial.
Keith Churchouse FPFS
CFP Chartered FCSI
Chartered Financial Planner
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