UK announces emergency budget amid great demand but little cash

London – So many requests. very little money.

However 3 weeks after taking officeUK Prime Minister Rishi Sunak faces the challenge of balancing the country’s budget while helping millions People overwhelmed by cost of living crisis that’s why Russia’s war in Ukraine pushes energy prices up and slow economic growth.

Treasury Secretary Jeremy Hunt is set to announce the government’s plan to tackle the turbulent economy in an address to the House of Representatives on Thursday.

The purpose of the emergency budget is to: restore financial and political confidence in government After ex-Prime Minister Liz Truss announced £45 billion ($53 billion), shortfall tax cuts lose investor confidence sent the pound to a record low against the US dollar and sparked Central bank emergency interventionTruss was forced to resign after six weeks in office.

Mr Hunt is expected to announce £30bn of spending cuts and £24bn of tax increases, the BBC and other British media reported.

Torsten Bell, CEO of the Resolution Foundation, a think tank that aims to improve living standards for low- and middle-income people, said the government would struggle to meet all the competing demands.

“The unpleasant reality is Rising global energy prices Conversely, we as a country will remain poorer than we would have liked,” Bell wrote this week. The question is how well you can handle that reality.”

That means dealing with the demands of nurses, police officers, border patrol agents and civil servants. Inflation accelerates to 41-year high of 11.1% in October. Welfare beneficiaries and pensioners are also demanding higher payments, and low-income households are demanding more free school meals programs.

But resources are limited. Faced with at least his £40bn ($47bn) budget shortfall, Sunak says he will need both. Tax hikes and spending cuts Close.

He is likely to announce an increase in taxes on windfall profits of energy companies to help consumers tackle the problem. Rising prices for natural gas and electricityThe government may also delay plans to raise the threshold for higher income tax brackets. That way, more revenue comes from individual taxpayers as salaries rise with inflation.

In a statement, the Treasury Department underscored its commitment to equity as the government balances its books and “ensures support for the most vulnerable and ensures that those with the broadest shoulders bear the heaviest burden”. He said he would reiterate.

Among those most in need of help is single mother Magdelena Procenic. She was struggling to feed her two young children, she explained as she waited in line at her food pantry at South London Community Food on Wednesday.

“I really hope there is an upper limit to rising costs,” she said.

Budgets face a tough backdrop. war in ukrainethe aftermath of the COVID-19 pandemic and economic strains from the UK’s exit from the European Union are all weighing heavily on the UK economy.

Economic output contracted by 0.2% in the third quarter, with the Bank of England forecasting a recession that could last for two years. The government is also paying for underfunded tax cuts announced by Truss. This has damaged the UK’s reputation for fiscal discipline and pushed up government borrowing costs.

Hunt and Sunak, who succeeded Truss as Conservative Party leader and prime minister last month, backed off most of Truss’ policies and promised the government would pay bills and start reducing the debt accumulated over the past 15 years.

UK public debt ballooned from less than 36% in 2007 to almost 83% of economic output in 2017 as the government struggled to bail out banks and strengthen the economy. When the COVID-19 pandemic and war in Ukraine pushed the debt to his 98% of gross domestic product, a decade-long budget tightening began to ease the burden. This is her highest since 1963, when Britain was still recovering from World War II.

But some economists warn against rushing to reduce government debt at a time when food, energy and housing costs are rising and one-fifth of UK households are about to lose their savings. I’m here.

Now that most of the Truss’ policies have been overturned, the government should be able to fill the remaining budget shortfalls with “relatively small” policy adjustments that do not jeopardize the investment needed to boost economic growth, the Independent said. A report from the National Institute states: For socio-economic research.

“The greater danger now is to demonstrate fiscal credibility by adopting overly restrictive fiscal policies, limiting support to poor households, or limiting critical elements of public investment. It is for us to collectively determine the

Single mother proscenic knows the pain of this hand. Wanting to do what she could for the baby and her 3-year-old, she queued up at her pantry for food offering discounts on essentials to dozens of families.

For £5 you can buy 20 essentials like fresh fruit, vegetables, canned beans and pasta. However, items such as eggs, which have skyrocketed in price, are in high demand, and there are only enough of them for those who come early.

“We are on welfare, but it is difficult to feed two children without help. They need fruit. They need diapers and formula.”

Anna Shovor-Packham, who owns the pantry, said the number of families buying food was increasing “slowly but steadily.” And then comes the cold winter months when families need to spend more on heating bills.

“I think there used to be an idea that someone who accesses a food pantry might need service as an eventual scenario. There might be a stigma about the type of person,” she said. “But now the pantry is definitely for everyone.”

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

https://www.local10.com/business/2022/11/17/uk-unveils-emergency-budget-amid-big-demands-but-little-cash/ UK announces emergency budget amid great demand but little cash

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