At the time of the announcements, the most massive strike mobilization in recent months was underway in the country, with hundreds of thousands of workers in public services as well as in the private sector participating
London, Thanasis Gavos
The budget for the next financial year, which in the United Kingdom begins in April, was presented on Wednesday in the House of Commons by the British Minister of Finance Jeremy Hunt.
At the time of the announcements, the most massive strike mobilization of recent months was underway in the country, with hundreds of thousands of workers in public services as well as in the private sector participating.
In particular, teachers, university lecturers, government employees, specialist doctors, train drivers on the London Underground, BBC journalists at local stations in England and Amazon workers participated.
Their main demand is for bigger increases amid a punctuality crisis, but also better working conditions and greater pension security.
Tens of thousands of strikers are estimated to have taken part in afternoon protest marches through the streets of central London and other cities.
Mr. Hunt did not hold off on announcing raises for workers in those public services.
Referring first to the fiscal forecasts of the independent Office for Budget Responsibility (OBR), the minister said a technical recession would finally be avoided in 2023, meaning two consecutive quarters of negative growth.
However, for the current year, a total contraction of the GDP by 0.2% is predicted.
The OBR also forecasts that the price of inflation will fall from 10.7% in the last quarter of 2022 to 2.9% by the end of 2023, a performance better than Prime Minister Rishi Sunak’s pledge to halve inflation.
“In the face of enormous challenges, I am reporting today a British economy that defies the naysayers,” the minister said.
However, in its separate parallel report the OBR notes that by the end of the next financial year, Britons’ living standards will have fallen by 6% as inflation continues to outpace growth.
It will be the biggest drop in living standards in the country since the 1950s, it said.
Among the economic measures announced by Jeremy Hunt is confirmation of an £11bn increase in the armed forces budget over the next five years. In this way, defense spending will now correspond to 2.25% of GDP by 2025, with the ultimate goal of raising this percentage to 2.5%.
Amid the ongoing UK cost of living crisis, he also announced a three-month extension, until June, of the £2,500-a-year cap on energy bill charges for each household with typical gas and electricity consumption.
It also pledged to invest £20bn over the next two decades in low-polluting energy projects such as carbon capture and storage. At the same time, nuclear power is being reclassified as an environmentally sustainable form of energy, which will attract more investment.
It also announced the gradual extension of free childcare for 30 hours a week in nurseries and other facilities in England to cover both one and two-year-olds, from the current threshold of three years.
Mr Hunt also held out the surprise of removing a cap on the amount workers can save towards a future pension without having to pay extra tax. The aim of the measure is to encourage older workers to extend their working life, so as to cover some of the shortages of manpower in the labor market.
From August, moreover, tax on alcohol in pubs will be 11p lower than it will be in supermarkets, a move the minister attributed to the “freedom of Brexit”.
The budget also includes enhanced credit opportunities for small and medium-sized businesses, tax breaks for theaters, museums and other cultural institutions, and increased investment in supercomputing programs to boost the artificial intelligence sector.
Despite urgings from some Tory MPs, Mr Hunt kept the planned rise in business tax from 19% to 25%. However, it offered tax breaks to companies making capital investments.
He also announced the creation of 12 Investment Zones across the UK, with funding to encourage innovation in partnership with local universities.
Reacting to the budget measures, the main opposition Labor leader Sir Keir Starmer said Britain was lagging behind other major countries in terms of competitiveness and that the minister’s announcements were nothing more than a “band-aid” to the country’s economic woes.
“The more it pretends everything is going well, the more it shows how out of touch the government is,” Mr Starmer commented.
With a wealth of experience honed over 4+ years in journalism, I bring a seasoned voice to the world of news. Currently, I work as a freelance writer and editor, always seeking new opportunities to tell compelling stories in the field of world news.