Spring Statement 2019: Briefing for Lords Debate
This House of Lords Library Briefing has been prepared in advance of the debate due to take place in the House of Lords on the motion moved by Lord Young of Cookham (Conservative) that “the Grand Committee takes note of the economy in the light of the Spring Statement”. The Chancellor of the Exchequer, Philip Hammond, presented the spring statement to the House of Commons on 13 March 2019. No changes to the tax system were announced in the statement, and only a small number of spending measures. The Office for Budget Responsibility (OBR) published revised forecasts for the economy and the public finances on the same day.
The Chancellor of the Exchequer, Philip Hammond, presented the spring statement to the House of Commons on 13 March 2019. In his speech, he said that the state of the economy was such that “provided we do reach a deal to leave the European Union with an orderly transition […] this country for the first time in a decade will have genuine and sustainable choices about its future”.
No changes to the tax system were announced in the statement, and only a small number of spending measures.
The Office for Budget Responsibility (OBR) published revised forecasts for the economy and the public finances on the same day. The OBR based its forecasts on an orderly Brexit, and stated that leaving the EU in a disorderly fashion would have a “severe short-term impact” on the economy. The Chancellor referred to a “deal dividend” in the event of an orderly departure, but also to the use of fiscal and monetary policies to mitigate the effects of leaving with no deal. This could include spending some of the “fiscal headroom” which he stated that he has kept in reserve.
The Chancellor provided some details of the next spending review, which will set the overall strategy for government spending. He stated that it would be launched before the summer 2019 parliamentary recess, assuming that “a Brexit deal is agreed over the next few weeks and that the uncertainty that is hanging over our economy is lifted”. The review would be concluded “alongside an autumn budget” and would cover a three-year period. He did not indicate how these plans might change if no Brexit deal was agreed.