14 March 2018

Chancellor Philip Hammond did his best to play down any hopes of special surprises in his Spring Statement, pointing out several days before that, although there was light at the end of the economic tunnel, the UK was still in the tunnel.

Despite this week's event coming at a time when we used to have the annual Budget, that big set-piece speech has moved to the late Autumn and Mr Hammond had made clear that there would be no major tax or spending changes in this week's Statement.

However, he told MPs, that did not mean that he lacked for good news for them. Indeed, he went on, rather than his usual guise as AA Milne's lugubrious donkey, he was now feeling much more like Tigger.

So what was so wonderful?

Well, the Chancellor said, the economy continues to grow, continues to create jobs and continues to beat expectations. Growth will be 1.4% this year, 0.1% higher than forecast.

Manufacturing has had the longest period of expansion in 50 years, he went on, and employment has increased by three million since 2010, which is the equivalent of 1000 people finding work every day.

Mr Hammond did have one or two proposals up his sleeve but these were things that would be consulted on, rather than anything more definite.

They included:

  • a plan to make the least productive businesses learn from the most productive;

  • taking action against late payments by companies;

  • a reduction in tax on the least polluting vans; and

  • a possible tax on single-use plastic.

The Chancellor said: "Our economy will remain outward looking, confident and ready to compete with the best in the world."

During his speech, the Treasury tweeted: "We’re raising the #NationalLivingWage to £7.83 per hour from next month" — but we already knew that.

For more detailed policy we will have to wait until the November Budget, when Mr Hammond has promised to set "an overall path for public spending for 2020 and beyond".