Figure 1 – UK gas-futures prices as of 19 September 2022
Figure 2 – Projected evolution of the price cap with and without Energy Price Guarantee
Figure 3 – Real GDP (2019 Q4 = 100)
Figure 4 – Unemployment (International Labour Organization definition)
Figure 5 – Consumer price index (CPI) inflation
Figure 6 – Bank rate
Figure 7 – Borrowing set to remain elevated throughout the forecast period
Figure 8 – Higher interest payments and fiscal loosening cause forecast borrowing to rise
Figure 9 – Growth Plan tax cuts increase borrowing costs
Figure 10 – Growth Plan tax cuts cause debt to peak later and higher
- ^ This costing is net of £2 billion paid by public-sector employers, for which they were compensated by HM Treasury. In the short term, reversing this tax rise will cost £15 billion as this additional money earmarked for paying employer contributions will be added to the Treasury’s reserve rather than this spending being cancelled altogether.
- ^ See p.39 of OBR (2011), Economic and Fiscal Outlook: March 2011, Cm 8036, https://obr.uk//docs/dlm_uploads/economic_and_fiscal_outlook_23032011.pdf.
- ^ D. Miles and V. Monro (2019), “UK House Prices and Three Decades of Decline in the Risk-Free Real Interest Rate”, Bank of England Staff Working Paper 837, https://www.bankofengland.co.uk/working-paper/2019/uk-house-prices-and-three-decades-of-decline-in-the-risk-free-real-interest-rate.
- ^ Though it is not entirely clear that the chancellor is still committed to maintaining a current budget balance from an HM Treasury statement on Monday. Announcing a fiscal plan to be published on 23 November, the Treasury said that this document “will set out further details on the government’s fiscal rules, including ensuring that debt falls as a share of GDP in the medium term”, suggesting that the rules themselves may be changed.