The Chancellor’s projections for economic growth look to be on the sanguine side. Having said that, the Treasury’s economic forecasts have tended to be closer to out-turn than has the independent consensus over recent years. Whether they will continue to be so in these uncharted economic waters remains to be seen.
In terms of the state of the public finances, the Treasury’s recent borrowing projections have consistently been over-optimistic and many will consequently take them with a pinch of salt. If this again turns out to be the case, it will have consequences for the sustainable investment rule, which will come perilously close to being broken even on yesterday’s central projections.
The Chancellor’s focus on green issues is to be welcomed. However, rather than targeting just a few specific polluting activities such as driving gas-guzzlers the government should focus on bringing all CO2 emitting behaviour within the EU Emissions Trading Scheme.
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