Chancellor's Spring Statement does offer 'good news' for Cumbria


"That's the OBR's forecast, Mr Speaker, but forecasts are there to be beaten", he said.

In his first spring statement to the House of Commons - not created to be a "major fiscal event" like the Autumn Budget - Mr Hammond revealed that the Office for Budget Responsibility now expects state borrowing to be £45.2 billion this year - £4.7 billion lower than predicted in November and £108 billion lower than in 2010.

The OBR said the biggest surprise in the data since November was a pickup in productivity growth but it said this was caused by people working fewer hours rather than producing more or weaker employment growth.

He said: "It's a fine line the Chancellor has to walk between borrowing and spending".

Business rates specialists have welcomed the change, saying it will make the system more responsive to economic changes.

Sterling rose after the announcement, but Old Mutual Global Investors head of United Kingdom equities Richard Buxton said this was likely in reaction to the USA dollar falling on the news that U.S. secretary of state Rex Tillerson was being fired, rather than anything material contained in Hammond's statement.

The UK's economy is forecast to grow 20 per cent slower than the Euro Area over the next five years.

Both the United Kingdom and the European Union could be hurt by these tariffs, but given the UK's extensive military and intelligence history with the USA (much akin to Australia's - another nation provided exemption), there is a chance that Britain might be able to secure exemption.

Hammond added that the borrowing forecasts confirmed "the first sustained fall in debt for 17 years, a turning point in the nation's recovery from the financial crisis of a decade ago".

"Anyone with a home loan may therefore get some knock-on benefits from today's statement - providing the OBR is correct in its assessment of inflation and an unexpected economic downturn does not blow the budget deficit reduction forecasts off course". That was less of a cut than many economists had expected.

They want to check a rise in support for the opposition Labour Party which has promised to end the Conservative squeeze on public-sector pay and invest more in infrastructure. "I would have capacity to enable further increases in public spending and investment in the years ahead, while continuing to drive value for money to ensure that not a single penny of precious taxpayers' money is wasted". This is expected to peak at 85.6% of GDP in 2017/18, before falling to 85.5% in 2018/19, then 85.1%, 82.1%, 78.3%, and finally 77.9% in 2022/23.

Summing up the OBR's report, Howard Archer, chief economic adviser to the EY Item Club, said: "There was continued caution in the deficit projections. the OBR's forecast implies that the strong gains in the fiscal position - seen so far this year - almost grind to a halt".

That would give the government the possibility of increasing spending shortly before the next national elections due in 2022.