UK tightens the budget by $65 billion, who will be left without money?
2022.11.18 10:44
UK tightens the budget by $65 billion, who will be left without money?
Budrigannews.com – IMF managing director Christina Georgieva met with British Finance Minister Jeremy Hunt on Wednesday to welcome the latest plan for a budget tightening of 5.5 billion pounds ( 6.5 billion).
“We will strike the right balance between fiscal responsibility and growth and the protection of vulnerable households,” Georgieva said in a brief statement on social media.
The IMF criticised Hunt’s predecessor, Kwasi Quarten, for his £9bn budget, including a planned non-funding tax cut on May 450.
These plans led to market turmoil, with the pound hitting record lows against the US dollar, forcing the BoE to intervene in the bond market and eventually costing then-British Prime Minister Liz Truss the job.
Georgieva said Hunt’s proposal would delay most spending cuts until after 2024, but the tax would rise almost immediately and was an appropriate response when the economy faced difficult conditions.
“We welcomed the (UK) autumn statement made at a difficult time for the UK economy against strong global headwinds in our meeting with Prime Minister Hunt today,” he said.
Inflation in the UK is at a 41-year high of 11.1%, and the Office for Budget Responsibility estimates that households this year will suffer the biggest drop in real income since the economy went into recession and records began in the 1950s.
Hunt’s plan represents fiscal year 2027-28 with tax increases and spending cuts equivalent to 2% of gross domestic product.
($1 = 0,84080 pounds)