IFS warns UK budget needs a plan for £35bn spending pressures
Funding inflation-related pressures and the pledge to raise defence spending to 3% of GDP by 2030 would require tax rises or benefit cuts of about £35bn, according to the IFS.
The Institute for Fiscal Studies warned John Healey that the UK budget could rely on unrealistic spending plans unless it explains how to address inflation-driven pressures and higher defence spending. It said the choices could involve tax rises, borrowing, benefit cuts or real-terms reductions in public services.
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AllegedThe Institute for Fiscal Studies warned that the budget could be a work of fiction without a plan to cover spending pressures.
“budget risks being a “work of fiction” unless he sets out plans to cover £35bn in spending pressures”
- 35BGBP
AllegedFunding inflation-related pressures and the pledge to raise defence spending to 3% of GDP by 2030 would require tax rises or benefit cuts of about £35bn, according to the IFS.
“would require tax rises or benefit cuts of about £35bn”
Higher inflation could force the government either to accept real-terms cuts to public services or to increase funding, borrowing or taxes.
“forcing the government to choose between accepting real-term cuts and finding efficiency savings or topping up departmental budgets”