What should be in the chancellor's Autumn Statement?

 

Chancellor George Osborne delivers his Autumn Statement on Wednesday 5 December.

It will be an update on the government's plans for the economy, accompanied by the latest forecasts and analysis from the Office for Budget Responsibility (OBR).

As ever, there are loads of pressure groups, analysts and armchair chancellors keen to tell him what he should be doing.

Here is a selection of some of the views being expressed.

David Orr, chief executive, National Housing Federation

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David Orr

We... oppose any further cuts to housing benefits, such as those suggested for the under-25s”

End Quote David Orr National Housing Federation

To fix our housing crisis we want the rapid release of small parcels of publicly owned brownfield land, to get building quickly.

This could provide up to 37,500 homes, create 55,000 construction jobs and get the economy moving.

To give housing associations the confidence to invest in new homes after 2015, government should continue to support affordable housing and confirm future rental income streams.

Raising the amount councils can borrow would encourage them to work more closely with housing associations to invest more in housing, boost supply and pump money back into local economies.

We also believe benefits should keep pace with rising living costs, and oppose any further cuts to housing benefits, such as those suggested for the under-25s.

Ros Altmann, director general, Saga

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Ros Altmann

The coalition government has done nothing to help savers”

End Quote Ros Altmann Saga

We would like this Autumn Statement to show that savers are valued. This is what every economy needs.

People with savings have often struggled to put that money aside and denied themselves things so that they can have financial independence.

It is important that we encourage people to save for their future, but if we continue to punish those who have done so, especially as they reach retirement, younger people will decide it is simply not worth it.

Young people saving to buy their first home are also suffering in the current economic climate.

The coalition government has done nothing to help savers.

There has been no recognition from the chancellor of people who have done the right thing, put money aside, wanted to look after themselves and be independent.

The government either doesn't recognise the damage that does, or doesn't care.

Tony Dolphin, chief economist, Institute for Public Policy Research

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Tony Dolphin

When growth is weak, spending cuts should be scaled back; when it is strong, they should be speeded up”

End Quote Tony Dolphin IPPR

George Osborne should abandon his two fiscal rules.

The first is no constraint at all, because it only requires him to forecast that the deficit will be eliminated in five years time, not to ever actually eliminate it.

The second - that debt should be falling by 2015-16 - can only be achieved by more tax increases or spending cuts, which would be a foolish move given the economy is so weak.

A new rule should specify that the scale of spending cuts will vary according to the strength of the economy.

When growth is weak, spending cuts should be scaled back; when it is strong, they should be speeded up.

This would increase the credibility of fiscal policy and allow the chancellor to announce a boost to infrastructure spending in 2013-14.

Ian Brinkley, director, The Work Foundation

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Ian Brinkley

There is no need for the government to pursue wasteful measures ”

End Quote Ian Brinkley The Work Foundation

The government can spend some money on stimulating the economy, but there are legitimate concerns about how this will be taken by the markets.

As a result, the money would be better spent on investment in infrastructure than in short-term tax cuts.

The money should be used to support the science, design and technology base and strengthen institutions focused on innovation.

As wages are low and employers are hiring in large numbers, there is no need for the government to pursue wasteful measures aimed at making the labour force less expensive or more flexible, such as national insurance holidays or further deregulation.

Such measures will do nothing to spur demand in the economy.

Eamonn Butler, director, Adam Smith Institute

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Eamonn Butler, director, Adam Smith Institute

The government should slash its spending on marginal things and focus on doing what is really important”

End Quote Eamonn Butler Adam Smith Institute

The chancellor must stick to his deficit-reduction plan, but raising taxes isn't the way.

Instead, he needs to boost growth.

If every small business hired one extra person we would be booming.

They don't, because our huge tax and regulatory burden is now an obstacle to risk-taking, enterprise and job-creation.

The chancellor should commit to a 15% corporation tax, which would stimulate investment and jobs.

And the 45% top tax should go - it is simply driving high earners abroad.

Meanwhile, our complex employment regulations discourage hiring and must be radically simplified.

On spending, we have had no austerity. Current spending is still rising.

The government should slash its spending on marginal things and focus on doing what is really important.

John Cridland, director general, CBI

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John Cridland

We also want bold action from the government to deliver big-ticket infrastructure projects that are pivotal to future growth”

End Quote John Cridland CBI

Businesses support the government's deficit-reduction plan because it's critical for the UK to keep confidence in international markets and interest rates low.

But the chancellor does have extra resources available.

The government under-spent by £7.8bn last year and will receive a windfall of up to £4bn from the 4G spectrum auction next year.

We believe that around £1.5bn of this should be invested into short-term growth measures, including a new capital allowance incentive for infrastructure investment, capped business rates at 2% in 2013, and local government spending on road maintenance.

We also want bold action from the government to deliver big-ticket infrastructure projects that are pivotal to future growth.

This "industrial Olympics" would mean fast-tracking key projects like upgrading the A303 and A14, the Northern Hub rail scheme and the Thames Tideway.

John Walker, chairman, Federation of Small Businesses

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John Walker

We want to see a clear plan of action from the chancellor, which he can take forward to Budget 2013”

End Quote John Walker Federation of Small Businesses

This is a pivotal point for the chancellor at the half-way point of the Parliament.

We are calling for three main things - more details on the business bank and how this will improve competition in the banking sector, reform of the labour market including an extension to the National Insurance contributions holiday scheme, a more simplified tax system, and for the 3p fuel duty rise to be scrapped.

Small business policymaking has been subject to a range of confusing patchwork approaches that have often had minimal impact on the ground.

We want to see a clear plan of action from the chancellor, which he can take forward to Budget 2013, which will detail the long-term support small firms need.

Key to this is going to be the small business bank and eventually how it can become the Small Business Administration, supporting small businesses over the long-term.

Joanne Segars, chief executive, National Association of Pension Funds

Start Quote

Joanne Segars

Quantitative easing has made it much more expensive for businesses to run final-salary pension scheme”

End Quote Joanne Segars NAPF

The chancellor must not restrict the amount of tax relief that people who are saving into a pension can get.

The system has already been through many changes in recent years.

These have been costly for businesses and pension funds, and have damaged public confidence in pensions as a way to save.

The government might say it is going after the rich, but many middle managers and more modest earners would get caught up in the net.

We need to be encouraging people to save for their old age, not putting them off.

Quantitative easing [QE] has made it much more expensive for businesses to run final-salary pension scheme.

The chancellor needs to acknowledge this by recognising that QE is distorting the books, and cutting pension funds some slack.

This could free up more cash for businesses to spend on investment and jobs.

 

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  • rate this
    +14

    Comment number 218.

    Something for savers – no one wants people depending on benefit – that means they should be encouraged to save for rainy days,

    But with interest rates kept artificially low and inflation rising – savers are losing money by the time they have paid tax.

    Maybe some sort of government bond with an interest rate linked to inflation could be an answer.

  • rate this
    +49

    Comment number 85.

    A freeze on Foreign aid, a cut in petrol duty, those who avoid tax to be hit with a massive cash grab and a tax on greedy utility companies. Dont expect any of that so get ready for the ordinary worker to be squeezed again and no help for millions of struggling families. Its like Osbourne and Cameron dont want a 2nd term the way they treat us.

  • rate this
    +38

    Comment number 69.

    What should be in the chancellor's Autumn Statement?

    Would it be asking too much to hope for a promise to ask REAL people (non-city types) what's needed and then offer an apology for not having done so before?

  • rate this
    +44

    Comment number 62.

    That the govt is aware that life and a larger proportion of the UK resides outside of London. Having acknowledged this they will give consideration to those living in the 'outer limits' rather than ensuring that their policies benefit and are well received by the self serving rich, overpaid fat cats in London.

  • rate this
    +7

    Comment number 59.

    What would have happened if these tough austerity measures hadn't been put in place? Why is this not studied, and widely published? The issue isn't whether the deficit is forecast to take longer than the govt first thought, but whether things would have taken longer (and been more damaging) if they had followed Labour policies at the time, and since.

    With these facts, I could vote informatively.

 

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