The Great Debate UK
- Mark Bolsom is the Head of the UK Trading desk at Travelex Global Business Payments. The opinions expressed are his own-
Later today, Chancellor George Osborne will unveil his first budget, where he is widely expected to take a tough stance. To the financial markets, this emergency budget is the agenda-setting piece of this parliament. Markets, media, consumers and businesses alike have all braced themselves for what has been billed as the sharpest fiscal tightening since the end of the Second World War.
This budget will make-or-break the UK economic recovery. In order to secure the UK’s treasured credit rating, it is essential Osborne details how he will cut the deficit. In Labour’s final budget, Darling refused to elaborate on how he planned to halve the deficit in four years, which damaged the UK’s credibility. If Osborne fails to obtain the essential buy-in from the financial markets, the UK’s credit rating will fall and sterling will plunge against most major currencies.
Therefore Osborne’s primary challenge is to balance the market’s thirst for deficit cuts without derailing economic recovery – and he will have a tough job. Credit agencies have already warned that cuts must be far-reaching – most recently Fitch said the UK needs to cut its borrowing by an additional 1% of GDP per year, if the UK wants to maintain its triple AAA credit rating.
-Joe White is managing director of Moonfruit.com. The opinions expressed are his own. Join Reuters for a live discussion with guests as UK Chancellor George Osborne makes an emergency budget statement at 12:30 p.m. British time on Tuesday, June 22, 2010.-
The first Tory budget is a critical one. The Treasury and Chancellor George Osborne have been dropping hints for weeks about a big slash in public sector spending in an effort to try and prepare Whitehall for the worst, and to rally the private sector to step in and fill the deficit.
-Nick Earl is partner at chartered financial planners Wardour Partners LLP. The opinions expressed are his own. Join Reuters for a live discussion with guests as UK Chancellor George Osborne makes an emergency budget statement at 12:30 p.m. British time on Tuesday, June 22, 2010.-
On Tuesday we will hear the first budget from new Chancellor George Osborne.
From the snippets of information we have heard from the Lib-Con coalition camp, I do not anticipate this budget will show much sympathy for middle or high earners.
-Thomas Story is tax director at BDO LLP. The opinions expressed are his own. Join Reuters for a live discussion with guests as UK Chancellor George Osborne makes an emergency budget statement at 12:30 p.m. British time on Tuesday, June 22, 2010.-
Ten key tests by which Chancellor George Osborne will be judged when he delivers the emergency budget on Tuesday:
-Laurence Copeland is a professor of finance at Cardiff University Business School and a co-author of “Verdict on the Crash” published by the Institute of Economic Affairs. The opinions expressed are his own. Join Reuters for a live discussion with guests as UK Chancellor George Osborne makes an emergency budget statement at 12:30 p.m. British time on Tuesday, June 22, 2010.-
George Osborne must be thankful to Don Fabio and his boys for ensuring that Wednesday’s tabloids will have other things to think about than the Budget, because it is going to be one of the toughest ever.
– Neil Collins is a Reuters Breakingviews columnist. The opinions expressed are his own –
Since Labour came to power in 1997, it has pursued a policy of expanding the numbers employed by the government or its agencies. The result is that today 6.1 million people are on the state payroll, an increase of about 900,000 in 13 years.
from UK News:
-- The author is a Reuters Breakingviews columnist. The opinions expressed are his own --
Alistair Darling promised no election "giveaways" and in one sense he delivered. The UK finance minister's budget is about not giving away the election. It might have been worse -- if Darling had acceded to his boss Gordon Brown's even more populist instincts. But there are vote-seeking swipes at high earners and banks, as well as a crowd-pleasing but misguided tax cut to first-time house-buyers. The UK's budget-balancing pain is being postponed and concealed. And that's risky.
- Jane Foley is research director at Forex.com. The opinions expressed are her own.-
Finally UK monthly public finance data has brought better than expected news. Not only was the net borrowing figure for February better than expected but the January data was revised lower from 4.3 billion pounds to just 43 million pounds, taking the total for the fiscal year to date 131.9 billion pounds.
-David Kuo is director at the Motley Fool. The opinions expressed are his own.-
If you thought 2009 was as bad as things will get, then think again: 2010 could be worse. It is likely to be a year of enforced austerity with both the government and households making obligatory cuts to their budgets.
High on the government’s agenda will be reducing the Budget deficit, if the UK is to avoid the embarrassment of having its sovereign debt rating cut by rating agencies. This will have a knock-on effect on households, which could see their disposable incomes slashed by hikes in both direct and indirect taxes.
- Anthony J. Evans is assistant professor at ESCP Europe business school. He will participate in a Reuters pre-budget live blog on Dec. 9, at 12 p.m. British time. The opinions expressed are his own. -
The main issue underpinning Britain’s next pre-budget report is the state of the public finances. Let’s be clear – they’re dire.