The City and Westminster are waiting to see what Philip Hammond does in the autumn statement next month. I write in The Sun this morning, that they are looking to see what the new Chancellor’s strategy is for guiding the economy through the uncertainty that will exist until we know what the Brexit deal is.
In a private meeting with Tory MPs this week, Hammond gave some indications as to what he plans to do on November 23rd. He was clear that it won’t be a give-away statement. He warned that the deficit remains ‘eye wateringly large’, that the debt to GDP ratio is getting close to the level at which the markets start to get concerned and that there needed to be a discipline on departmental spending to reassure the markets.
But, he said, he wanted enough flexibility to step in if the economy did begin to slow down. He was clear that if that was necessary, he would rather borrow to invest in infrastructure than cut VAT.
Perhaps, the most interesting thing, though, was his lament that the bottleneck in planning ‘has never yet been effectively addressed’. I understand that the government, led by Hammond and the Communities Secretary Sajid Javid, is now trying to sort this problem. A housing white paper will come out at roughly the same time as the autumn statement. It will include proposals for a shake-up of the planning system designed to get more houses built. I understand from senior Tories that they are prepared to take a hit from some of their more NIMBYish supporters to get this done.
Much or Hammond’s multimillion pound fortune comes from his time as a property developer. If he can’t sort the planning system, then it might be beyond fixing.
Join The Spectator for a discussion on the Autumn Statement, taking place on 23 November 2016 at 6.30 p.m. at Soho’s Ham Yard Hotel. After the new Chancellor presents his financial statement, The Spectator’s chairman Andrew Neil, editor Fraser Nelson and political editor James Forsyth will discuss what it reveals about the government’s preparations for Brexit. A Q&A session and drinks reception follow. In association with Old Mutual Global Investors.
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