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oh dear: Financial market turmoil could blow a hole in Osborne's budget plans

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    oh dear: Financial market turmoil could blow a hole in Osborne's budget plans

    Financial market turmoil could blow a hole in Osborne's budget plans, says IFS

    Chancellor's 'inflexible' budget surplus rule could come at a high cost, warns IFS, leading to big tax rises ( ) or spending cuts (AtW's comment: yeah right)



    " Financial market turmoil and slower pay growth have blown a hole in George Osborne's plans to balance the books by 2020, according to the Institute for Fiscal Studies.

    The IFS said the Chancellor was "boxed in" by a rule that requires the government to run a budget surplus every year from 2019-20 "in normal times" - or when the economy is growing at an annual rate of 1pc or more.

    This means Britain faces the prospect of "big tax rises or spending cuts with very little notice to ensure the rule is met", the IFS said in its annual Green Budget.

    The think-tank said the recent turbulence meant tax receipts could be much weaker than the Office for Budget Responsibility (OBR), the Government's fiscal watchdog, forecast just three months ago.

    Last week, the Bank of England downgraded its projections for growth, wages and inflation amid a gloomier global outlook.

    The IFS said weaker pay growth was likely to reduce tax revenues by £5bn over the next four years compared with current forecasts.

    The turbulence in global markets could lower capital tax receipts by a further £2bn unless share prices recovered, the think-tank said.

    This, combined with £8bn worth of unfunded tax cuts to come this parliament meant Mr Osborne "could be forced into additional spending cuts or tax rises if economic and fiscal forecasts again turn out unfavourably".

    Even if the Chancellor's plans remain on course in 2019, the IFS said past errors in official forecasts meant there was a one-in-four chance more belt tightening would be needed by the end of the decade.

    "There may be more tough decisions to come," said Paul Johnson, IFS director. "

    More from the source: Financial market turmoil could blow a hole in Osborne's budget plans, says IFS - Telegraph

    But as Waldorf says, it would have been a lot worse under Labour

    #2
    Atw, why not get yourself a hot girlfriend and stop obsessing over doom, gidiot and DFS sofas?

    Comment


      #3
      Originally posted by DimPrawn View Post
      Atw, why not get yourself a hot girlfriend and stop obsessing over doom, gidiot and DFS sofas?
      Can't I have the best of both worlds?


      Might need a new sofa if I close purchase on my flat, got survey people coming in tomorrow

      Comment


        #4
        Originally posted by AtW View Post
        But as Waldorf says, it would have been a lot worse under Labour
        Labour never promised to get rid of the deficit, so they wouldn't have missed any targets. Their promise on the deficit was so vague and full of caveats - that the two Ed's could claim success no matter what happened.

        So even if we end up in the same level of tulip, it would have sounded better under Labour.

        But seriously, Osborne is being hammered for having the balls to set a hard target. He might be a total tulip-up, but at least he's made it easier to measure his degree of tulip-up ness.
        Last edited by centurian; 9 February 2016, 07:28.

        Comment


          #5
          Don't worry. AEP says there's near zero chance of a recession.

          Comment


            #6
            Originally posted by DimPrawn View Post
            Atw, why not get yourself a hot girlfriend and stop obsessing over doom, gidiot and DFS sofas?

            Mods, ban Dimprawn for posting pics of MFs wife

            Comment


              #7
              Do these clowns really believe the BS they sold the public, i.e., the national economy is run like a household economy? The whole thing is fiction; the only thing these morons need to do is not print too much money. As long as the markets are happy enough that things are ticking over we're fine. There's no reason to mandate a budget surplus or balance the budget unless you're happy to keep on squeezing the majority of wage earners (hint, not people earning more than £50k) and a masochist. And idiots actually thought these guys would be better than Labour at running the economy?

              Comment


                #8
                Originally posted by seanraaron View Post
                And idiots actually thought these guys would be better than Labour at running the economy?
                Fortunately, they are. Just not by much.

                Comment


                  #9
                  Originally posted by seanraaron View Post
                  Do these clowns really believe the BS they sold the public, i.e., the national economy is run like a household economy? The whole thing is fiction; the only thing these morons need to do is not print too much money. As long as the markets are happy enough that things are ticking over we're fine. There's no reason to mandate a budget surplus or balance the budget unless you're happy to keep on squeezing the majority of wage earners (hint, not people earning more than £50k) and a masochist. And idiots actually thought these guys would be better than Labour at running the economy?
                  How is that working out then?

                  I thought money printing, ZIRP, immigration and rising house prices were what is needed?

                  Comment


                    #10
                    So glad Osborne fixed the roof while the sun was shining.
                    http://www.cih.org/news-article/disp...housing_market

                    Comment

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