Spring Statement 2018: What Changed and Why
2018’s Spring Statement is expected to be very different. Here are the reasons behind the changes and our predictions.
This year’s Spring Statement was very different to what we’ve come to know.
The event is normally used as a ‘mini-budget’ to showcase new and planned policies, but this year Philip Hammond gave a much shorter speech.
This year’s statement was also without the major submission operation beforehand: a process which historically allowed business groups, charities and members of the public to communicate with the Treasury to express their needs for the year ahead.
Mr Hammond, responded to the forecast from the Office for Budget Responsibility and gave an update on actions from the Autumn Budget but avoided announcing further major changes in his Spring Statement.
In this shortened event, Hammond gave a brief response to fiscal forecasts produced by the Government’s public finance watchdog but there were no spending announcements within the shorter statement; neither was there a photo-shoot outside 11 Downing Street.
Furthermore there was no red box, no official document, no spending increases and only light tax and wage amendments.
The New Statement
Going forward the Spring Statement will be used as an opportunity to pitch ideas that will be built upon at the main budget later this year, however some fiscal statements will remain. As previously mentioned it is expected that the Chancellor will continue to respond to the Office for Budget Responsibility, who asses the United Kingdom’s prospects for growing in the years ahead.
Why It’s Changing
The Spring Statement is changing, largely due to re-organisation of tax management in the UK, and pressure from larger corporations who are strained at having to undergo major planning preparation in line with two annual budgets, unlike any other country.
In a statement Mr Hammond commented, “no other major economy makes hundreds of tax changes twice a year, and neither should we”. Welcome news indeed.
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