Jeremy Hunt suggests tax cuts in budget won’t match last year’s £20bn giveaway – UK politics live | Politics

In his interview with the BBC’s Nick Robinson, Jeremy Hunt, the chancellor, criticised Richard Hughes, head of the Office for Budget Responsibility, for calling the Treasury’s long-term public spending forecasts worse than “a work of fiction”.

Hughes told a Lords committee last month:

Some people call [the projections] a work of fiction, but that is probably being generous when someone has bothered to write a work of fiction and the government hasn’t even bothered to write down what its departmental spending plans are underpinning the plans for public services.

Asked about the comment, Hunt said:

Those words are wrong and they should not have been said.

The government decides spending plans and spending reviews.

The next spending review will start in April 2025 and obviously until that point when that spending review is done, we do not publish our spending plans. No government ever has.

Good morning. Labour is holding a business conference today, with tickets going at £1,000 a time to executives who want to learn how a Keir Starmer government might handle the economy. According to a press release overnight, 400 senior business leaders are attending, and tickets sold out within four hours. Keir Starmer and Rachel Reeves, the shadow chancellor, are both speaking.

But this morning it is Jeremy Hunt, the chancellor, making the news, with a declaration that his scope for tax cuts in the budget may be limited. In an interview with the BBC’s Nick Robinson for his Political Thinking podcast, Hunt said:

It does not look to me like we will have the same scope for cutting taxes in the spring budget that we had in the autumn statement.

And so I need to set people’s expectations about the scale of what I am doing because people need to know that when a Conservative government cuts taxes we will do so in a responsible and sensible way.

But we also want to be clear that the direction of travel we want to go in is to lighten the tax burden.

Earlier this week the Times reported that Hunt delivered this message to cabinet. In their report, Mehreen Khan and Steven Swinford said Hunt told colleagues there would be less headroom for tax cuts than in the autumn statement and that relatively low levels of ­productivity in Britain were “our major structural ­weakness”. Asked about the report on ITV’s Peston show last night, Hunt said:

As things stand at the moment, things can change, it doesn’t look like I’ll have the kind of room I had for those very big tax cuts in the autumn, and I did mention that to the cabinet, yes.

This may, of course, just be expectation management. In September last year Hunt said that tax cuts would be “virtually impossible” in the light of economic circumstances as they were then. Two months later, in the autumn statement, he announced tax cuts worth £20bn.

But, in assessing what politicians say, it is always worth starting with the assumption that they might be telling the truth, and it would not be surprising if Hunt has concluded that he cannot afford massive tax cuts – because that is exactly what mainstream economists are saying. Only this week the IMF suggested Hunt would not be able to reduce taxes without public spending being cut to an unacceptable level.

It is also worth pointing out that there is a huge difference between ruling out “very big tax cuts”, and ruling out any tax cuts. There were two main tax cuts in the autumn statement: a cut of 2p in the pound from national insurance, costing £9bn in 2024-25; and full expensing, a tax cut for business worth £11bn a year by 2027-28.

For electoral reasons, Hunt is expected to focus on personal tax cuts in the budget and he could still do quite a lot on that front without matching the £20bn splurge from last autumn.

Here is the agenda for the day.

10am: Rachel Reeves, the shadow chancellor, gives a speech and holds a Q&A at Labour’s business conference.

10am: Rishi Sunak holds a meeting in Downing Street to mark the creation of a new small business council.

11.30am: Downing Street holds a lobby briefing.

After 11.30am: MPs hold two 90-minute debates on the two regulations being passed to implement the reforms to the Northern Ireland Windsor framework announced yesterday.

12pm: Humza Yousaf, Scotland’s first minister, takes questions at Holyrood.

2pm: Keir Starmer gives a speech and holds a Q&A at Labour’s business conference.

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