Sunday, 11 March 2018

We're not out of austerity tunnel yet - Chancellor Philip Hammond

Chancellor Philip Hammond has rejected calls by Labour and some Conservatives to announce the end of austerity in his spring statement on Tuesday.

He is expected to unveil the smallest budget deficit since 2002, thanks to better than expected public finances.

But he told the BBC national debt was still too high, adding: "There is light at the end of the tunnel... but we are still in the tunnel at the moment."

Mr Hammond told the BBC's Andrew Marr (pictured) while defence was already the fastest growing department he accepted there were 'pressures' on the military Budget

Labour has urged him to end the "pain and misery" of public spending cuts.

Mr Hammond told the Andrew Marr Show it would be wrong to pour "every penny" into additional public spending.

He said it was "very important moment" to see debt starting to fall after growing for 17 continuous years.

But he said: "We should be very careful looking at single sets of figures - one quarter or two quarters - we need to look at what's happening sustainably in the economy."

The day-to-day deficit has been eliminated, it emerged earlier this month, two years later than former chancellor George Osborne had wanted when he set out in 2010.

The UK is now running a surplus of £3.8bn in its current budget - the money borrowed to fund day-to-day spending rather than long-term investment - according to the Office for National Statistics.

"We have a debt of £1.8 trillion - 86.5% of our GDP," Mr Hammond said. "All the international organisations recognise that is higher than the safe level."

BBC        News.