Jeremy Hunt faces the biggest moment of his political career today when he delivers his first UK budget speech since becoming Chancellor of the Exchequer.
He is expected to announce a swathe of tax hikes and public spending cuts as the Prime Minister Rishi Sunak seeks to fill the fiscal black hole left behind by his predecessor Liz Truss. It is believed the autumn statement could see a reboot of the austerity introduced during the 2010s under David Cameron and George Osborne.
It comes after Hunt announced arguably the biggest set of u-turns in British political history on 17 October, as the Chancellor sought to repair the economic and political damage caused by Liz Truss’s disastrous mini budget.
The huge set of unfunded tax cuts promised by Truss during the Conservative leadership contest and implemented by ex-Chancellor Kwasi Kwarteng caused the pound to fall to record lows, led to a narrowly-avoided run on pension funds, and saw UK mortgage rates leap to their highest levels since the 2008 financial crisis. The UK now also faces a lengthy recession.
So, when is Jeremy Hunt’s budget taking place? Here’s what you need to know.
Why is another UK budget happening?
Before his sacking, Jeremy Hunt’s predecessor Kwasi Kwarteng promised to set out the government’s medium-term plans for the UK economy, and provide an independent forecast from the independent Office for Budget Responsibility (OBR).
It came after he gave a mini budget that pledged to make a swathe of tax cuts without providing any costings. Liz Truss had hoped her tax cuts would fuel an economic boom because the cost of doing business in the UK would have been reduced - as well as keeping the UK out of a recession, she hoped trickle down economics and putting money back into people’s pockets would ease the cost of living. However, this was found to be fantasy economics.
Crucially, these tax cutting plans were not accompanied by the customary OBR analysis - something which spooked markets as they felt the government was about to embark on a costly public borrowing spree.
When it became clear the markets needed reassurance that the government did have a plan to get government borrowing under control, Kwarteng announced a budget event that would set out the Liz Truss government’s medium term plans. While initially scheduled for November, the then-Chancellor was forced to bring it forward to Halloween at the Conservative Party Conference in Birmingham after coming under severe political pressure.
Kwarteng was also forced to u-turn on a planned cut to the 45p income tax rate he wanted to introduce - a tax cut that would have benefitted the UK’s highest earners. However, this did not go far enough for MPs or the markets, and an embattled Liz Truss opted to sack Kwarteng in an apprent bid to extend the life of her premiership - a move that ultimately failed.
With Jeremy Hunt scrapping many of the mini budget tax cuts upon his appointment as Chancellor on 14 October in a bid to improve the UK’s economic position, it became clear Truss would soon be out of a job. This eventually took place a lot more quickly than anyone would have expected.
When Rishi Sunak then came into office, the emphasis turned towards tax hikes and spending cuts to fill a £40 billion black hole and restore the Conservatives credibility with both the public and the markets. He delayed the budget from Halloween to 17 November.
Jeremy Hunt has said this event will seek to “balance the books” - a direct reference to the austerity budgets seen during the tenure of George Osborne - and bring down the inflation that has been driving the cost of living crisis.
What time is Jeremy Hunt’s autumn statement?
Jeremy Hunt is due to deliver his autumn statement on Thursday (17 November). Timings have not yet been officially released, but NationalWorld understands the speech will begin at approximately 11.30am, and last for around an hour. It was originally scheduled to be at 10.30am, but has been delayed so Rishi Sunak can make a statement after returning from the G20 summit.
Afterwards Labour’s Rachel Reeves will respond and an OBR forecast briefing will then take place at around 2pm. The OBR event will finally give the public and the markets an insight into the state of the UK’s public finances. The independent public body will be able to tell us how much of a budget deficit the UK faces, as well as how much the tax measures Hunt sets out will raise.