According to reports, Philip Hammond, the Chancellor of the Exchequer, has come under tremendous pressure in recent times. The pressure arises from a need to spend more on the country’s maintenance while cutting down its deficits.
Statements from the Institute for Fiscal Studies (IFS), state that Hammond has been under pressure to fund the public sector pay rises. He is also being pushed to spend more on the NHS, schools, and benefits.
However, the expense on the Budget scheduled for November 22 would make it harder for him to cut the deficit. Speaking of the problem, IFS’ deputy director, Carl Emmerson stated that Mr. Hammond was in a “very difficult position”.
Describing a situation that seems to exemplify the ‘rock and hard place’ saying, the deputy director wondered which the Chancellor would choose.
\He asked, “Does he (Hammond), allow higher borrowing to persist, does he add to that with more spending, or does he try to offset that with higher taxes?”
He added that even if the November Budget included some “giveaways” it would not put an end to the austerity. According to Emmerson, it was “likely to continue, whatever he announces”.
The IFS has also stated that the Chancellor may have to give up hopes of balancing the public finances by 2025.
Emmerson stated that it was perhaps time to admit that this particular dream was “no longer sensible”. He stated that another complicating factor affecting the finances was Brexit.
Mr. Hammond however, had a different tune to sing. Speaking to the BBC last week, he stated that the government had already moved the target for balancing the books from 2020 to 2025.
He added that moving the deficit down in a sensible way over a period of time was “the right way to go”.