Chancellor confirms Spring Statement will be two weeks before the Brexit deadline this March
The Treasury have confirmed that the Chancellor of the Exchequer will give his Spring Statement on Wednesday, 13th March 2019 – only sixteen days before the UK is set to depart from the European Union.
Since 2016, the Spring Statement is not intended to contain any major policy announcements, and this year is no exception – although a no-deal Brexit could trigger an emergency budget. The statement gives the Chancellor an opportunity to update Parliament on the economy and respond to the Office of Budget Responsibility’s (OBR’s) forecast.
Philip Hammond confirmed the date in a letter to the Commons’ Treasury Committee on Tuesday. The timing of the statement has surprised some commentators, given the uncertainty surrounding Brexit and that the Finance Bill has still not been passed.
Previous correspondence between the Chancellor and the Office of Budget Responsibility had indicated a date of “no sooner than 25th February and no later than 31st March” for this year’s Spring Statement.
The Evening Standard has played down the significance of the announcement, calling it a “slimmed-down” statement and quoting an “expert” who said: “It is basically fulfilling a legal requirement to issue the latest forecasts from the Office for Budget Responsibility before the end of March”.
The latest OBR commentary on the public sector finances showed that borrowing had risen in December, due to a lower EU rebate and higher capital spending, however borrowing was down by a quarter for the first three quarters of 2018-19 relative to same period of the previous year, pushing down the deficit.
The UK Budget is usually prepared annually, although recently in 2010 and 2015 there were two Budgets in the respective calendar years. This was formally ended at the Autumn Statement 2016 when Philip Hammond declared that the Budget would return to its annual format, citing that all other major global economies only make one annual adjustment to their tax systems. The Budget was moved to the Autumn from its usual March slot to align Royal Assent of the Finance Bill with the start of the fiscal year, and as such, the March Budget became the Spring Statement.
30th January 2019.
Sources:
https://obr.uk/docs/dlm_uploads/December-2018-Commentary-on-the-Public-Finances-1.pdf
https://www.gov.uk/government/news/spring-statement-2019-date-confirmed
https://www.bbc.com/news/topics/cl72r5pyqent/chancellors-spring-statement
https://www.ft.com/content/fa0303fe-1e29-11e9-b2f7-97e4dbd3580d
https://www.accountancydaily.co/spring-statement-set-two-weeks-brexit
