Autumn Statement 2014 Thread

[Ash4781]

Stamp duty reform fact sheet. Though it's probably easier to look at FT's / RK's posted tweets.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/382324/Stamp_Duty_15.pdf

[R K]

Is that chart actually in the OBR report ?

Is that chart actually in the OBR report ?

See chart 3.31 in the first 'economic and fiscal outlook charts and tables' xls chart pack on the link below

See chart 3.10 for the house price inflation chart posted above, together with a table of the actual revised increases

and also 3.08 Average mortgage rate which is revised lower due to lower forecast bank rate

and 3.07 Banks' marginal funding costs, which are revised down a little over 1% by end of the forecast period.

(I'd post them but for some reason this site is telling me the extension isn't permitted)

http://budgetresponsibility.org.uk/economic-fiscal-outlook-december-2014/

Edited December 3, 2014 by R K

[Ash4781]

See chart 3.31 in the first 'economic and fiscal outlook charts and tables' xls chart pack on the link below

See chart 3.10 for the house price inflation chart posted above, together with a table of the actual revised increases

and also 3.08 Average mortgage rate which is revised lower due to lower forecast bank rate

and 3.07 Banks' marginal funding costs, which are revised down a little over 1% by end of the forecast period.

(I'd post them but for some reason this site is telling me the extension isn't permitted)

http://budgetresponsibility.org.uk/economic-fiscal-outlook-december-2014/

Cheers.

[ingermany]

I think you've got to ask yourself what the difference between private and public debt is if the government is prepared to stand behind mortgage holders.

When it is guarantor to the borrower and owns the bank lending the money, and has lent the money being borrowed to the bank lending the money. What could possibly go wrong?

[Ash4781]

Channel 4 news touched on the expected spending cuts in the next parliament. Vince Cable hinted considering the scale the department cuts would unachievable. The unspoken being tax rises post election.

I hace not locate the relevant OBR section yet.

Edited December 3, 2014 by Ash4781

[oracle]

taxy taxy - its all thats left

not that Osborne will tell you that

it's not all that's left though.

where was this bonfire of the quango's that was much touted 5 years ago?.still waiting by the look of it.

trying to bash together two pieces of flint to get it started when they should have used a flamethrower and a couple of gallons of petrol.

get rid of pointless legislation and allow small business to grow again...then they pay tax, then treaury gets money.

easy.

of course both balls AND osbourne were taking their orders from the same paymasters in the first place, so do not epect that to change any time soon.....which is where UKIP have got them both rattled.

[billybong]

Amazing that the media were treating it seriously and on the radio afterwards it was hours of analysis and interviews. The promises were very similar to those before the 2010 general election that were reneged on so shouldn't be taken too seriously.

The stamp duty changes likely won't be reneged on as they've already been introduced (apparently at the moment you can choose between the old rates and the new rates whichever you prefer - see how quickly something can happen if they want it to) and that'll be because they think the changes will act as a prop to some extent for the few months until the general election even if it doesn't do any more than that.

Edited December 3, 2014 by billybong

[frederico]

Yeah the whole thing was a fantasy, the actually cuts were not discussed, but they will have to happen.

A section of the OBR report shows that about 80% of the deficit reduction has got to come from cuts in services.

[Si1]

http://www.telegraph.co.uk/finance/autumn-statement/11271923/Autumn-Statement-2014-George-Osborne-produces-a-rabbit-and-shoots-a-fox.html

[billybong]

From the numbers in the Autumn Statement it looks like after Mr Alexander announced yesterday that (up to) 300,000 new homes a year would be built during the next Parliament today Mr Osborne reneged on that figure.

He didn't even wait until after the general election - that's if they were to get back in power.

[Venger]

Would that be because they are desperately hoping that people will take on ever more debt, because debt fuelled consumer spending is the only thing likely to keep the economic show on the road?

Uncertain what to expect now, about cuts ahead... although I know deficits such as these can not compound for too long against solvency of a country vs market. The £1million IHT Threshold believers will eventually get dragged back into the real world.

Faisal Islam @faisalislam · 2 hours ago

..MoD, MoJ, BIS councils etc implied fall to 85bn from 188bn over austerity decade. OBR basically: 'not gonna happen'

Faisal Islam @faisalislam · 2 hours ago

Day 2 Story for #as2014 is this OBR table... On unbelievable implied cuts to non-protected departmental spending:

Faisal Islam @faisalislam · 4 hours ago

OBR says implied cuts "pose a significant challenge". polite.

Faisal Islam @faisalislam · 5 hours ago

total managed spending/ GDP: “@OBR_UK: OBR: public spending heads for 80 year low

Faisal Islam @faisalislam · 5 hours ago

That's 1934: “@OBR_UK: OBR: Budget moves towards surplus as public spending heads for 80 year low

Faisal Islam @faisalislam · 11 hours ago

Up until 1997 the stamp duty rates were simply 0% and 1%... Threshold just 60k

https://twitter.com/faisalislam

[Ash4781]

Uncertain what to expect now, about cuts ahead... although I know deficits such as these can not compound for too long against solvency of a country vs market. The £1million IHT Threshold believers will eventually get dragged back into the real world.

Suggest tax rises and or a total reorganization of government eentities (central departments, county councils, unitary authorities, parish councils, etc). Maybe they'll even take out a whole tier like the local authorities?

[Dorkins]

Grown up 'Wallace and Gromit' dig there as part of our national democracy in action. "More cheese?"

If I was giving a public presentation while at work in which I called our competitors "Wallace and Gromit" everybody would think I was an unprofessional clown.

[Dorkins]

Brillo is quite good until you start threatening the price of HIS house.

Andrew Neil said on Twitter that he rents.

[Si1]

Suggest tax rises and or a total reorganization of government eentities (central departments, county councils, unitary authorities, parish councils, etc). Maybe they'll even take out a whole tier like the local authorities?

Yep

It's pushing at achieving the small scale of public services in the mid 90s

Severe pain to be had in some quarters to achieve this.

[SarahBell]

He's had an earful on R4 not long ago about the cuts.
He's going to make cuts to working age benefits.

Which would happen automatically if they just put NMW up to £10 and offered struggling firms a bit of help to get them used to paying real wages.

[Si1]

This is only likely to happen if Tories get an all out ge victory, which is of course very unlikely

[Si1]

Talking heads on breakfast TV saying it'll be awful for poorly paid overworked public sector workers

[Si1]

I like it when the media keep referring to 'the cuts' and 'austerity' and I keep thinking, 'None of that has actually happened yet'.

The proposed reduction in government spending could probably done easily through more 'self-service' / 'digital government' and a generally smaller state/less interference in areas the government shouldn't be involved in. However, some of the savings would be lost through an increased JSA bill.

Lump of labour fallacy

[Si1]

Maybe, but you'd have to say in the short-term there would be a spike in unemployment/JSA claims if there was a significant reorganisation of the public sector. Not saying that they would be incapable of doing something else.

Fair enough. Still a minor cost tho

[R K]

Stephen King (hsbc chief economistic) worth a read in FT

Based on OBR report, Tory cuts can only be achieved with a collapse in household savings ratio i.e. houseold debt/income ratio will soar (see earlier in thread), resulting in rapidly rising house prices.

Outcome will be either rapidly rising inflation or more likely a balance of payments crisis.

http://blogs.ft.com/the-a-list/2014/12/03/stephen-king-autumn-statement-2014-wishful-thinkers/

[Timak]

I like it when the media keep referring to 'the cuts' and 'austerity' and I keep thinking, 'None of that has actually happened yet'.

But some of it has.

Local government have had their central government grants reduced by 40% already.

Councils I work at have lost on average 20% of their staff since 2010.

Most are drawing on reserves but the picture is massively bleak for most of them.

[Si1]

Stephen King (hsbc chief economistic) worth a read in FT

Based on OBR report, Tory cuts can only be achieved with a collapse in household savings ratio i.e. houseold debt/income ratio will soar (see earlier in thread), resulting in rapidly rising house prices.

Outcome will be either rapidly rising inflation or more likely a balance of payments crisis.

http://blogs.ft.com/the-a-list/2014/12/03/stephen-king-autumn-statement-2014-wishful-thinkers/

Yep

I think there a degree of resignation implicit in the govts actions that we will have a sterling crisis

Impossible to win the 2020 election for the incumbents in that situation, even tho it'll actually be silver lined in the long run

[Venger]

He's had an earful on R4 not long ago about the cuts.

He's going to make cuts to working age benefits.

Which would happen automatically if they just put NMW up to £10 and offered struggling firms a bit of help to get them used to paying real wages.

I would rather see any free money measures towards company creations / entrepreneurship.

Only living cost that is outrageous is housing (not for older VI). Mostly only see the HPI heads/VI landlords calling for higher wages... so buyers/tenants can pay more. H£lp Struggling firms paying higher wages? You can't have Gubbermint make up the wages for all (the costs would be outrageous and suggests badly run companies don't get found out by market) - the money and it would only go to landlords/VI anyway.

Exports fail to rebalance GDP as business investment falls sharply

Published: 22:04, 26 November 2014

[..]But exports dropped 0.4 per cent and business investment fell 0.7 per cent, although it was still up 6.3 per cent on a year earlier.

The figures, from the Office for National Statistics, dented hopes that the UK economy is rebalancing away from domestic spending to investment and trade.

[..]‘In particular the slight fall in business investment is disappointing. However, the most concerning aspect of these figures is the widening trade deficit, as exports fell and imports rose.

[..]Jeremy Cook, chief economist at the currency experts World First, said: ‘Overall growth is still pretty strong. Unfortunately it is the make-up of this growth that has given us some cause for concern. ‘Seeing consumer spending increase is all well and good. Consumer spending makes up around 70pc of the UK economy, so without it we would be in dire straits. It is what’s missing that is the issue.’

[SarahBell]

But some of it has.

Local government have had their central government grants reduced by 40% already.

Councils I work at have lost on average 20% of their staff since 2010.

Most are drawing on reserves but the picture is massively bleak for most of them.

Would love to see the spread of job cuts across the salary scales and showing front line staff vs managers.