Spring statement reaction
Tuesday 13 March 2018
AS CHANCELLOR Philip Hammond makes his spring economic statement, our business experts react to the content of the speech, and look ahead to what may be to come for our economy.
Faisal Sheikh, international finance and economics expert at the University of Salford Business School, comments on the Spring Statement.
He said: “The Chancellor forecast a positive if not upbeat view of the UK economy in today’s Spring Statement. This is based on the downward trajectory of inflation, borrowing and debt. He stated ‘"We have made solid progress towards building an economy that works for everyone."
“UK PLC has grown year in year out since the 2008 financial crunch and a 1.7% growth was achieved in 2017 in comparison to the forecast of 1.5%. The key drivers of this growth are productivity and output. Although the Brexit ‘divorce bill’ has yet to be quantified the strong, if not resilient. UK economy should help the Government weather any political or economic challenges.
“The Chancellor could potentially spend more but this is unlikely as austerity has become a way of life for most Britons. Finally, the government continues to aggressively pursue trade deals e.g. with the USA, which should help calm the financial markets.”
And Dr Gordon Fletcher, retail expert at the University of Salford Business School, said: “The Spring Statement was a downbeat affair in both presentation and substance. The Chancellor's focus is set on the long-term reduction of national debt softened by the expected "gift" of an increase in the personal allowance.
“In an economy with modest growth projections, the uncertainty of Brexit and a pressing need for investment in housing stock, a cautious conservative statement was the most expected route for Hammond to take.
“More interesting were the various "calls for evidence" about plastics use, promoting green transport, collecting VAT on online sales and digital payments. The Chancellor's recognition of the digital economy was also a positive signal, however citing Matt Hancock MP’s app as an exemplar of these developments was probably an ill-considered overly enthusiastic shout-out for a colleague.”