Black Hole

Treasury officials and the Office for Budget Responsibility have told the Chancellor that the fiscal black hole is somewhere between £50bn and £60bn, and that at least three-fifths of measures to fill that hole will have to come from public spending cuts, if he and the PM want to honour what they see as the most important Tory manifesto commitments.
According to a source, officials presented options to Jeremy Hunt over the weekend for how to find £35bn of spending cuts and £25bn of tax rises, if the hole is £60bn, and for a split of £30bn of spending cuts and £20bn of tax rise if the Office of Budget Responsibility finally settles on a hole of £50bn.
Before I get on to more detail of Hunt's and Rishi Sunak's plans, it is worth noting that the Autumn Statement in just over a week will create a significant political headache for Labour.

Because most of the planned spending cuts will fall after the general election, and Labour will therefore have to decide whether to adopt them.
In other words, it will have to decide within weeks whether to abandon or defer very important policies, notably its pledge to spend £28bn per year on green investments - which is the heart of its environmental and economic plans.

https://www.itv.com/news/2022-11-07/chancellor-prepares-between-30bn-and-35bn-of-public-spending-cuts

Cant wait to see what happens today  on TV 11.30am

Is this  some of what we can expect?


Around £30bn in spending cuts, totalling around 55% of the measures
£24bn in tax rises, equating to 45% of the measures
The threshold when the highest earners start paying the top rate of tax will be lowered to £125,000 from £150,000
The health budget will be protected and increase in real terms - even when price rises are taken into account
Support for energy bills is expected to remain in place - but become less generous from April 2023
The energy industry will be hit with a significantly expanded windfall tax to help pay for the support
An increased National Living Wage from the current level of £9.50 an hour for over-23s
The BBC also understands the state pension and benefits will rise with inflation - although this has not been officially confirmed

Motoring tax system to be made 'fairer'
Katy Austin

Transport correspondent

The Chancellor has announced electric vehicles will no longer be exempt from Vehicle Excise Duty from April 2025 to make the motoring tax system "fairer".

hancellor Jeremy Hunt has confirmed that the energy industry will be hit with an expanded windfall tax of 35% up from 25% from 1 January until March 2028.

"I have no objection to windfall taxes if they are genuinely about windfall profits caused by unexpected increases in energy prices," he says.

"But any such tax should be temporary, not deter investment and recognise the cyclical nature of many energy businesses."

He will also introduce a temporary 45% levy on electricity generators. He says together these taxes will raise £14bn next year.

Northern Powerhouse rail and HS2 to go ahead
Hunt goes on to confirm that rail projects will go ahead as planned: the Northern Powerhouse rail, the HS2 and the East West Rail.

Pensions triple lock protected

Pensions to rise by 10.1% from April
Hunt confirms that pensions - like benefits - will rise in line with September's inflation rate of 10.1%.

He says that as a result the government is sticking to its “triple lock” on the state pension.

That refers to a manifesto pledge that the state pension would rise in line with the highest of: the previous September's inflation figure, the average wage increase, or 2.5%.

Taxation and wages:

The threshold for when the highest earners start paying the top rate of income tax will be brought down from £150,000 to £125,140
Income tax, personal allowance and higher rate thresholds will be frozen for a further two years, until April 2028
The main National Insurance and inheritance tax thresholds will be frozen for a further two years, until April 2028
The National Living Wage will be increased from £9.50 an hour for over-23s to £10.42 from April next year
Tax-free allowances for dividend and capital gains tax is due to be cut next year and in 2024
Energy:

Help for energy bills will be extended, but it will be less generous
There will be targeted support with the cost of living for those on low incomes, disability and pensioners
A Windfall tax on the profits of oil and gas firms will increase from 25% to 35% and extended until March 2028
New "temporary" 45% tax on companies that generate electricity will be applied from January
Economy and public finances:

The Office for Budget Responsibility (OBR) judges the UK to be in recession, meaning the economy has slowed for two quarters in a row
It predicts growth for this year overall of 4.2%, but size of the economy will shrink by 1.4% in 2023
UK's inflation rate predicted to be 9.1% this year and 7.4% next year
Government will give itself five years to hit debt and spending targets, instead of the current three years
Other measures:

Means-tested benefits, including Universal Credit, will rise in line with inflation
Pensions will also rise in line with inflation
Rent rises in the social sector will be capped at 7% in the next financial year
Lifetime cap on social care costs in England due in October 2023 delayed by two years
Sizewell C nuclear plant to go ahead
Northern Powerhouse rail and HS2 also to go ahead as planned
Government spending:

Defence spending to be maintained at 2% of national income - a Nato target
Overseas aid spending to be kept at 0.5% for next five years, below the official target of 0.7%
NHS budget will increase in each of the next two years by an extra £3.3bn
Schools will get an extra £2.3bn next year and the year after
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Still no tax tax on Gruel?