Economists question ‘hole’ in public finances

Research published by the Progressive Economy Forum has suggested that the fiscal ‘black hole’ in the public finances of between £40 billion and £50 billion is the result of ‘government accountancy rules and uncertain forecasts’ as opposed to tax and spending decisions.

Economists used official forecasts from the Office for Budget Responsibility (OBR) in determining that small changes in forecasts for future growth and rates ‘dramatically alter the size of the hole in the public finances’.

According to the Progressive Economy Forum, these changes to accountancy rules and forecasts ‘produce hugely bigger effects’ than the £50 billion worth of measures the government is rumoured to be considering for the upcoming Autumn Statement on 17 November.

Rob Calvert Jump, an author of the research, commented: ‘There is now a consensus among economists that austerity does significant damage to an economy’s potential, undermining growth, as the experience of the last decade in Britain has shown us.

‘Further austerity will do far more damage than a ‘fiscal hole’ that disappears with tweaks to models or accounting rules.’

The Progressive Economy Forum’s research into can be viewed in full here.

Chancellor Jeremy Hunt will present the 2022 Autumn Statement on 17 November. We will be keeping you up to date on the day’s announcements.

Need help with your accounts? Please do not hesitate to contact us.
Picture of Blue Spire

Blue Spire

We're Here For you

Let's talk

Our friendly team are ready to help you and answer any questions you may have. Just use the form below and get in touch.

Scroll to Top