NIESR Predicts a Fiscal Head‑Turn! And It’s Not All Sunshine
Chancellor’s Big Promise Shaken by Numbers
The National Institute of Economic and Social Research (NIESR) is giving the government a stern look‑in‑the‑mirror. They warn that Chancellor Rachel Reeves might have to hammer on tax again – a ripple that threatens to break the very fiscal rules she claimed she’d uphold.
Growth Screws Down, Consumer Spirits Remain Low
- GDP growth wobbles to 1.2% in 2025 — a slump from the earlier 1.5% forecast.
- Business confidence is as shaky as a tree limb in a gale, and uncertainty is piling up like a novelty door‑stop.
Fiscal Buffer on a Tightrope
During the Spring Statement, the Chancellor pledged to keep a £9.9 billion cushion by 2029. Bye bye, that expectation! NIESR is shouting: we’re looking at a £62.9 billion shortfall by 2029/2030. The threat of higher taxes and deeper cuts is on the table.
Experts Speak the Truth
Benjamin Caswell says, “No headroom means tough choices next autumn.” Stephen Millard, the interim director, warns that the ever‑changing fiscal rules have forced the Chancellor to reverse‑engineer savings or spank the system with tax hikes.
Adrian Pabst adds that the UK’s dream of growth for every corner needs more than just London boosters—second‑tier cities and poorer regions deserve a fair slice of public investment.
What This Means for You
Higher taxes, fewer spending opportunities, and a sluggish economy might be on the horizon. It’s a wake‑up call that the government’s financial framework deserves a makeover.
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