Spring Statement: expectations

Chancellor Rishi Sunak will deliver his Spring Statement in Parliament this afternoon.

This type of event usually involves chancellors setting out figures about the UK economy, but many people want Sunak to go further and announce measures to combat the cost-of-living crisis.

He will first summarise figures from the Office for Budget Responsibility, which, if similar to other forecasts, will show less-than-hoped recovery in GDP and a higher peak in inflation than previously predicted.

Sunak may then announce financial support for people struggling with rising costs, particularly energy bills, which will rise by 54% on 1 April 2022.

However, Treasury insiders told the Financial Times the Statement will be "policy-light", and major fiscal decisions will be taken in the Autumn.

But they did say a few new policies are in the Statement, which could include a cut to fuel by up to 5p and an increase or repeat of the energy rebate package.

Another possibility is for the National Insurance threshold to be increased from £9,568 to £12,700 to match income tax, which is a Conservative manifesto pledge.

Yet, as Faisal Islam, economics editor at the BBC, said:

"The current cost of living crisis threatens to turn into an emergency. And although this could be a new normal lasting years, don't expect a pandemic-style rescue, this time."

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