LONDON – The United Kingdom will set aside 3.3 billion pounds ($4.3 billion) over the next two years in preparation for Brexit, the Chancellor of the Exchequer revealed on Wednesday as the Office that reports on the British economy revised growth forecasts down over the next five years.
Setting out the Autumn budget for 2018-2019 at the House of Commons, the lower chamber of parliament, Philip Hammond said that setting aside the money would allow the Conservative government to prepare for any eventuality as the country left the European Union, which includes a possible no deal situation.
“We have already invested almost £700m in Brexit preparations and today I am setting aside over the next 2 years a further £3bn,” Hammond told the chamber.
Opening the budget statement, the Chancellor told the house that the Office of Budget Responsibility, which reports on the sustainability of public finances in the United Kingdom, had revised the country’s productivity outlook.
The latest figures offered by the OBR suggested that gross domestic product would drop to 1.5 percent in 2017, 1.4 percent in 2018 and 1.3 percent in 2013, before falling flat for two years and up-ticking to 1.6 percent in 2022, which is still short of the 2 percent forecast outlined in March.
Hammond described the figures as “stubbornly flat.”
He prefaced the GDP outlook with a positive take on the country’s employment figures, insisting that OBR predictions suggested 600,000 more people would be in work come the 2020s, although he recognized that the current unemployment rate of 1.4 million was too high.
Hammond said “1.4 million people out of work is 1.4 million too many,” drawing jeers from the Labour party opposition in reference to claims he made during a recent TV interview in which he appeared to suggest there were no unemployed people in the UK, remarks he later dismissed as misinterpreted.
In his response to the Autumn budget, Labour leader Jeremy Corbyn, a left-wing politician, pounced on the poor growth forecast.
“Economic growth has been revised down, productivity growth has been revised down, business investment has been revised down, people’s wages and living standards revised down. What sort of strong economy is that? What sort of fit for the future is that?” Corbyn said, coining a phrase used by Hammond.
In a speech peppered with jokes, the Chancellor who has been humorously branded “spreadsheet Phil” by some of his Tory colleagues, apparently because of his often dry delivery style, touched upon topics ranging from education to health care.
Another key announcement in the budget was the abolishment of stamp duty for first-time house buyers for properties up to 350,000 pounds, which will also apply to the same amount for those spending up to 500,000 pounds.
Hammond said that the number of young home-owners had dropped in recent years and that it was hard for them to save for a deposit as salaries were being absorbed by rent payments.
Around 44 billion would be invested into housing, the Chancellor said.
A total of 10 billion pounds would be put towards improving facilities and services in the National Health Service in England while another 2.8 billion would be allocated to NHS resources.