Philip Hammond hints at public spending increases later this year

Philip Hammond has dropped the broadest possible hint that he will announce spending increases later this year as he sought to use a modest improvement in the public finances to indicate more money was on the way for hard-pressed public services.

The chancellor seized on new forecasts from the Office for Budget Responsibility showing a £5bn drop in the government’s budget deficit to say that he expected to have scope to act in his autumn budget. Hammond was accused of “astounding complacency” by the shadow chancellor, John McDonnell, but said higher spending had to be accompanied by further action to reduce government borrowing and the national debt.

“If, in the autumn, the public finances continue to reflect the improvements that today’s report hints at, then in accordance with our balanced approach ... I would have the capacity to enable further increases in public spending and investment in the years ahead,” the chancellor said.

The first spring statement, the replacement for the traditional March budget, was designed to include no new tax or spending decisions but did announce:

    That Britain’s post-Brexit payments to the EU could continue until at least the mid-2060s.

Source: theguardian