Philip Hammond’s Autumn Statement has revealed the full ‘Brexit bombshell’ as economic growth will be slower, there will be higher inflation, higher borrowing, and higher debt.
- The independent OBR has revised down GDP growth for next two years – next year growth will be just 1.4% (down from 2.2%), and 1.7% for 2018 (down from 2.1%).
- Overall, GDP is set to be 2.4% lower than if the UK had voted to remain in the EU.
- Inflation is set to rise to 2.7% next year, according to the Bank of England.
- Borrowing is set to rise from previous predictions. Overall, there will be over an additional £100 billion of borrowing. It will total £68bn in 2016/17, £59 billion in 2017/18, £46.5 billion in 2018/19.
- As a result, national debt will peak at a modern record of 90.2% of UK GDP in 2017/18. The OBR has forecast that this represents a £220 billion increase in national debt by the end of this Parliament. Total national debt will equate to over £1.9 trillion by the end of this Parliament.
We have had the Brexit Bombshell – growth will be slower, there will be higher inflation, higher borrowing, and higher debt.
The Conservative government promised to make deficit reduction the centrepiece of their economic policy but due to their continued mismanagement, the OBR (Office for budget responsibility) has forecast a £220 billion increase in national debt by the end of this Parliament and the total national debt will equate to over £1.9 trillion by the end of this Parliament.
It’s quite evident from the economic forecasts that the policy of austerity is not working and its only serving is to plunge the country into further misery and heap more pressure on those less fortunate.
This contrasts dramatically to the Scottish Government who have announced a £100m economic stimulus plan and a £500m Scottish Growth Scheme, to mitigate the immediate effects of the EU referendum.
The major threat to the economy remains a hard Tory Brexit and Scotland being dragged out of the Single Market.