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🇬🇧 United Kingdom /Economy & Trade

Faisal Islam: Chancellor’s effort to lift economic mood may constrain tax rises

From BBC News · () English

Translated from English and summarized by DistantNews. Read the original for the full story.

At a glance

Analysis Named sources New plan
  • The chancellor used a speech at Coventry’s Manufacturing and Technology Centre to promote confidence and fiscal discipline amid high borrowing costs and confirmed job losses at Jaguar Land Rover.
  • John Healey declined to say whether the October 28 Budget would include significant tax rises or changes to the state pension triple lock.
  • The government is trying to sustain improving consumer, business and recruiter confidence while controlling borrowing.

The chancellor’s attempt to improve Britain’s economic mood may make it harder for the government to raise taxes in next month’s Budget.

a new story

· John HealeyThe chancellor’s description of the government’s effort to improve the economic mood.

His choice of Coventry’s Manufacturing and Technology Centre for his first major speech appeared especially pointed, given its proximity to Jaguar Land Rover’s headquarters. As the speech took place, the loss of 4,000 office-based jobs at JLR was confirmed, a development John Healey presented as evidence of the global turbulence from which the UK needs greater resilience.

Healey’s message differed from the approach associated with his predecessor. He argued that fiscal discipline should build confidence among consumers, companies and investors rather than weaken it amid continuing fears of tax increases. The prime minister and chancellor have made a deliberate effort to create “a new story” about the economy and revive the “economic animal spirits” suppressed by years of political and economic turmoil.

Borrowing costs are too high

· John HealeyHealey’s warning about pressure on the Budget from global bond yields.

There are signs that the message may be registering. Measures of consumer, business and recruitment confidence have improved, although the article also points to unusually hot weather and the World Cup as contributing factors. The government now faces the challenge of protecting that fragile confidence while dealing with borrowing costs that Healey acknowledged were too high.

I won’t comment. I can’t comment. No chancellor can ahead of a Budget I will take and announce on October 28th.

· John HealeyHis response when asked whether the speech was preparing the ground for significant tax rises.

Asked whether the speech was preparing the ground for major tax rises, Healey replied, “I won’t comment. I can’t comment. No chancellor can ahead of a Budget I will take and announce on October 28th.” He also avoided confirming or rejecting calls to scrap the pension triple lock, which raises state pensions by the highest of inflation, wage growth or 2.5%. “The prime minister has said, like I have, that we must bring down welfare costs, but we are also responding to the extreme pressure that is there in wider markets,” he said. Neither response settled what the Budget will contain.

The prime minister has said, like I have, that we must bring down welfare costs, but we are also responding to the extreme pressure that is there in wider markets.

· John HealeyHis response to a question about the pension triple lock and market pressures.
About this summary

Originally published by BBC News in English. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

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