It’s that time of year again! It seems quite odd that we’re actually having one, given the utterly unrecognisable swirling madness of 2016, but the public finances are one of those things that keeps going under the most unlikely of circumstances. So let’s pretend everything is normal. Here are my considered predictions for the 2016 Autumn Statement.
- 90% of the statement’s word count will cover 10% of its financial value.
- Whatever talk about “JAMs” we have to put up with in the meantime, the IFS distributional analysis will show a typical Osborne curve, with a massive hit to centiles 1 through 6, a small giveaway to 7 through 9, and a tiny cut to 10 to make it technically true to say that this wasn’t a giveaway to the super-rich. This has been true of the last six budgets.
- The OBR will forecast a huge government deficit going forwards on the basis of current policy, and insist on more of the current policy. Its terms of reference specifically forbid it to do anything else, so that’s what it will do. As literally nobody other than me will tell you, back in June 2010 it rolled over and changed its forecasts to please the then Chancellor and nobody resigned, so that’s the level of credibility and integrity you should expect from it.
- But that’s OK because the OBR will also forecast a return to pre-2007 trend growth Real Soon Now, in a couple of Friedman-units’ time. It has done this in every forecast since June, 2010 and rolled the delivery date forward each time.
- You can safely ignore the statement itself so long as you read the IFS briefing afterwards.
- If it’s “over X years”, “flat cash”, or it doesn’t come with a percentage of GDP, it’s probably a lie.
- Half the government’s policy agenda will be announced as part of the budget, because the chancellor wants to be prime minister.
On 1), I really think there should be a lower limit on the in-year value of anything included in a Budget or pre-budget statement. Chancellors like to throw in £50m to save the Caledonian Sleeper for two reasons – first, it’s an opportunity to hand out the pork, second, it’s a way to avoid scrutiny of genuinely important line items, either by distraction (shiny thing!) or just by clogging the wires with noise. Both are disgraceful. It also creates a temptation to fiddle with things that generally work, which is undesirable. At last, a reform we can all get behind.
Also, Osborne curve you say? Here you go:
— Torsten Bell (@TorstenBell) November 20, 2016