Chancellor announces Budget date of 29 October
Chancellor Philip Hammond said he will announce his autumn budget on 29 October, the first on a Monday for over half a decade.
"I’ll set out how our balanced approach is getting debt falling while supporting our vital public services, and how we are building a stronger, more prosperous economy," Hammond said on Twitter.
Recent government borrowing figures showed the Chancellor would have plenty of leg room to increase spending in the Budget, while there could also be new revenue raising plans such as the special tax on online retailers he recently suggested.
Borrowing for the year to date was down 30.5% at £17.8bn, which some economists suggest will lead the Office for Budget Responsibility to revise down its full-year forecast for £37bn, allowing the Chancellor to deliver the promised increase in National Health Service spending without having to increase taxes or make cuts elsewhere.
Sam Tombs at Pantheon Macroeconomics said last week that borrowing is on track to undershoot the Chancellor’s 2020/21 cyclically-adjusted limit of 2% by a comfortable margin and, at the very least, will not need to announce offsetting tax rises to fund the extra money that recently has been earmarked for the NHS.
"Indeed, faced with pressure from his own MPs to boost his party’s opinion poll standing and the political imperative to show that the economy has prospered after leaving the EU in March 2019, we expect the Chancellor to ease off austerity measures in other areas too, ensuring that fiscal policy doesn’t dampen GDP growth next year," Tombs said.
However, Howard Archer, chief economic adviser to the EY Item Club, said although borrowing continues to run well below 2017-18 levels, the fact that revenue growth is only running in line with its previous forecast and the likely temporary nature of the undershoot in spending means that major changes to the OBR’s projections are looking increasingly unlikely.
"This means the Chancellor may need to use revenue raising measures, or tolerate higher borrowing, in order to fund the extra spending planned for the NHS."
In his spring statement in March the Chancellor said he would use his autumn budget to set out spending totals for 2020 and beyond with a spending review in 2019.
Resisting calls for short-term spending and for austerity to be eased, Hammond said if public finances continue to improve there will be room to increase public spending.
The last time there was a Monday budget was in 1962 when the Chancellor was Selwyn Lloyd.