UK’s Next Budget Will Take Place on March 15, Jeremy Hunt Says - BLOOMBERG
(Bloomberg) -- Prime Minister Rishi Sunak’s UK government will deliver its next budget on March 15, Chancellor of the Exchequer Jeremy Hunt said.
Hunt has asked the independent Office for Budget Responsibility to prepare a set of forecasts for that date to accompany the budget, he said in a written statement to Parliament on Monday.
The budget will be Hunt’s second major fiscal event, following an Autumn Statement on Nov. 17 in which he unveiled a £55 billion ($67 billion) package of tax rises and spending cuts to stabilize Britain’s public finances after a series of economic shocks.
Sunak and Hunt face a daunting task as they try to restore stability to the public finances with the UK already likely in a recession and interest rates rising to contain inflation that’s still near a 40-year high.
The ruling Conservatives accepted Hunt’s package — including £25 billion of tax rises — because of the need for the government to calm financial markets after Sunak’s predecessor, Liz Truss, tanked the pound and triggered a sell-off in bonds with a massive unfunded package of tax cuts.
But many in the party are deeply unhappy that Sunak and Hunt have raised the country’s tax burden to its highest since World War II, leaving the chancellor little scope to bring in more levies. There’s also a reduced appetite for more spending cuts, with many public services stripped to the bone by a decade of austerity under successive Tory administrations.
Since Truss left office after a disastrous 7-week tenure, UK borrowing costs have improved, and there are signs inflation may be peaking. This month the Bank of England lifted its benchmark lending rate a half point to 3.5% as it tries to curb rising prices, which have been fueled by higher energy costs linked to Russia’s war in Ukraine and domestic issues such as a tight UK labor market.
Hunt has said his priority is curbing inflation before trying to stimulate the economy through tax cuts.
“I know this is tough for people right now, but it is vital that we stick to our plan, working in lockstep with the Bank of England as they take action to return inflation to target,” the chancellor wrote in a letter to BOE Governor Andrew Bailey on Thursday. “The sooner we grip inflation the better.”