The Adam Smith Institute Responds To Reeves’ Spring Statement
Joanna Marchong, head of communications and external affairs of the Adam Smith Institute, said:
“The Chancellor has convinced herself of economic stability based on deeply outdated forecasts. It is a Statement written by spin doctors, not economists.
"After last year's Autumn Budget, Reeves needed to show that those sacrifices were not in vain and deliver growth. OBR forecasts, even though they don’t reflect current shocks, appear to show her rules are just about intact, but growth is lacklustre and the UK is far from credible.
“Markets are wobbling, and while the Spring Statement coincides with the unpredictable nature of war in the Middle East, this makes it even more vital that Reeves reforms the very anti-growth, anti-business measures she has introduced.”
Mitchell Palmer, economist of the Adam Smith Institute, said:
“The Chancellor’s message was one of stability, but the numbers underline just how constrained the UK’s position remains. Growth is modest, and the fiscal buffer, while seemingly intact, leaves little room for complacency. Recent energy shocks underline the need for even larger buffers.
“Falling inflation and a strong January surplus are welcome, but they don’t change the structural picture. Without change, an ageing population and ever-increasing health spending will continue to undermine Britain’s fiscal sustainability.
“The priority now must be to raise the economy’s growth potential. That means accelerating planning reform, reducing the cost of employing people, setting Britain’s nuclear and gas sectors free, and reforming taxes to encourage work and investment. Without stronger underlying growth, today’s relative stability risks becoming tomorrow’s squeeze.”
-ENDS-
Notes to editors:
For further comments or to arrange an interview with one of our team, contact joanna@adamsmith.org | 07985540467
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