Under the previous Labour government we called this a pre-Budget report, but Chancellor George Osborne calls it his ‘Autumn Statement.’ In any case, this is where government paints a picture of where we are, where we have been and where we can expect to go financially in the UK.
The date has been set for late November, the 29th to be exact as it was reported to MPs as the chancellor was addressing them in the House of Commons. However, just before Chancellor Osborne’s statement, earlier on the same day, the Office for Budget Responsibility will release their independent economic forecast for the coming year.
At the moment the Office for Budget Responsibility is forecasting growth to be expanded by 1.7% for the current year but this is much higher than forecast by most leading economists. With inflation hitting 4.4% in just the month of July alone amidst markets that are falling by the day, there is a very real fear that the growth rate will not come near that projected figure.
As well, many economists feel the increased standard VAT rate will impact the forecast for economic growth as fewer businesses will be showing profit and as a result, will be cutting jobs. It is already evident that consumers are cutting back on spending which plays a huge role in the economy.
In a recent statement, the chancellor called for “credible cuts” when speaking of countries with huge deficits. This could relate to the UK as well as most leading economies around the world that have recently experienced rating downgrades.
In any case, properties are losing value, there is a concern over the Eurozone debt crisis and even our neighbours across the Atlantic are realising debt woes. It will be interesting to note how this will play out in the chancellor’s statement, but we can probably expect that the current austerity programme will be highly emphasised.
