March 13, 2018 / 12:55 PM / 8 months ago

Highlights: British finance minister Hammond delivers update on economy

LONDON (Reuters) - Philip Hammond, Britain’s finance minister, delivered a half-yearly update on the public finances and the economy.

Britain's Chancellor of the Exchequer Philip Hammond leaves 11 Downing Street to deliver his half-yearly update on the public finances, in London, March 13, 2018. REUTERS/Toby Melville

Below are highlights from his speech to parliament:

ON OFFICE OF BUDGET RESPONSIBILITY REPORT

“Today the OBR delivers its second report for the fiscal year ... It forecasts more jobs, rising real wages, declining inflation, a falling deficit and a shrinking debt.”

ON BORROWING, AND ON LABOUR’S FISCAL PLANS

“I reported in the Autumn that borrowing was due to fall in every year of the forecast and debt to fall as a share of GDP from 2018-19.

“The OBR confirms this today and further revises down debt and borrowing in every year. Borrowing is now forecast to be 45.2 billion pounds this year, 4.7 billion pounds lower than forecast in November.

And 108 billion pounds lower than in 2010 which, coincidentally, is almost exactly the total cost of the additional spending pledges made by the Party opposite (opposition Labour Party) since the General Election last year. Mr Speaker, it’s taken them just 9 months to work up a plan to squander the fruits of eight years hard work by the British people.”

ON GDP FORECASTS

“As a percentage of GDP, borrowing is forecast to be 2.2 percent in 17-18, falling to 1.8 percent in 18-19, 1.6 percent in 19-20, then 1.3 percent, 1.1 percent and finally 0.9 percent in ‘22-‘23, meaning that in 18-19 we will run a small current surplus, borrowing only for capital investment.

“And we are forecast to meet our cyclically adjusted borrowing target in ‘20-21 with 15.4 billion pounds headroom broadly as forecast at the Budget.”

Reporting by Elisabeth O'Leary and Kate Holton, editing by Estelle Shirbon

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