Standard & Poor’s has delivered its verdict on George Osborne’s mini-Budget. It has reduced its outlook to negative, as per Citi’s predictions (which I blogged about last week). Citi said the S&P thumbs-down would happen in the new year: it took days. S&P now thinks there’s at least a 33pc chance that the UK will lose its AAA rating. Little wonder, given that UK debt is rising faster than any country in Europe.
S&P says the UK could lose its coveted AAA status…
“in particular as a result of a delayed and uneven economic recovery, or a weakening of political commitment to consolidation.”
I suspect this refers to what James Forsyth refers to as Osborne’s St Augustine approach to deficit reduction: Lord, give me fiscal discipline. But not yet.
The below graph shows each of Osborne’s budgets/statements, and the pink shows the proportion of fiscal pain being delayed until after the next election.
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