adplus-dvertising
Connect with us

Economy

UK’s Hunt says public spending will grow slower than the economy

Published

 on

LONDON — British finance minister Jeremy Hunt said on Thursday that public spending would grow more slowly than the economy, with a real terms squeeze in spending in many departments, though overall spending in public services will rise over the next five years.

Hunt said just over half of the needed 55 billion pounds ($65.2 billion) fiscal consolidation would come from cuts in spending.

“We are going to grow public spending – but we’re going to grow it slower than the economy,” Hunt said in a speech to parliament.

Hunt said for the remaining two years of the government’s Spending Review, it would protect the increases in departmental budgets it had already set out in cash terms, a sharp real-terms cut given high rates of inflation.

“And we will then grow resource spending at 1% a year in real terms, in the three years that follow,” Hunt said.

“Although departments will have to make efficiencies to deal with inflationary pressures in the next two years, this decision means overall spending in public services will continue to rise, in real terms, for the next five years.”

Hunt said he would raise

state retirement and welfare benefits payments

by 10.1% – in line with inflation.

Hunt said it would not be possible to restore the aid budget to 0.7% of gross national income from its current level of 0.5% because of the “significant shock to public finances.”

But he announced 3.3 billion pound increase in the National Health Service’s budget this year and next, and a rise in spending for social care and schools over the next two years.

The Office for Budget Responsibility said that funding increases for the NHS, social care and schools were largely offset by the reduction in aid spending.

It added that 1% real terms increases in current departmental spending would reduce cash spending “by amounts rising to 22.2 billion in 2027-28,” compared to the prior assumption it would rise in line with nominal GDP.

Torsten Bell, chief executive of the Resolution Foundation think tank, said there were also real-terms cuts in investment spending.

He said that while there was “no good news for public services,” the fiscal statement did not represent a return to the austerity of the coalition government of 2010-2015, adding there were “smaller day-to-day cuts than expected.”

Hunt delayed a decision on increasing defense spending, saying a new integrated review on security policy was needed and he would update again in the next budget. ($1 = 0.8434 pounds) (Reporting by David Milliken and Alistair Smout; editing by Michael Holden and Toby Chopra)

Source link

Continue Reading

Economy

PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

Published

 on

 

OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.

However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.

The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.

Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.

The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.

The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.

This report by The Canadian Press was first published Oct. 17, 2024.

The Canadian Press. All rights reserved.

Source link

Continue Reading

Economy

Statistics Canada says levels of food insecurity rose in 2022

Published

 on

 

OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.

In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.

The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.

Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.

In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.

It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.

This report by The Canadian Press was first published Oct 16, 2024.

The Canadian Press. All rights reserved.

Source link

Continue Reading

Economy

Statistics Canada says manufacturing sales fell 1.3% to $69.4B in August

Published

 on

 

OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.

The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.

The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.

Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.

Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.

Overall manufacturing sales in constant dollars fell 0.8 per cent in August.

This report by The Canadian Press was first published Oct. 16, 2024.

The Canadian Press. All rights reserved.

Source link

Continue Reading

Trending