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The Office of Budgetary Responsibility (OBR) makes a point in its Fiscal Risk Report today that ought to be obvious and yet which hardly ever seems to feature in debate over the public finances and ‘austerity’. It is virtually certain that sooner or later the UK economy will suffer another recession which will cause tax receipts to sink, welfare payments to grow and so quickly reverse any progress that has been made in closing the deficit.       In fact, you can pencil in that recession for sooner rather than later. The risk of a recession in any five year period, calculates the OBR, is as high as one in two. And when

Last week it was Vince Cable trying to tell us that Brexit was depriving Wimbledon spectators of their strawberries – swiftly denied by the All England Club. This week it is the turn of pizza chain Franco Manca to try to scare us of the consequences of Brexit. Announcing the company’s results, chairman David Page said, in comments prominently reported in the pro-EU Financial Times: “The long-term Brexit impact is unknown. It is, however, already affecting the availability of skilled European restaurant staff”. In other words: your pizza is under threat from your silly vote to leave the EU. Brexit hasn’t appeared to hit the company’s bottom line, however. Revenue of

The 48 per cent have spoken – and they want higher taxes, according to the British Social Attitudes survey. In the wake of a general election in which Labour won support based on a manifesto of free spending, is it time for a rethink on tax? And should we wave goodbye to the era of austerity? Here’s what today’s newspapers make of the case for a tax hike: We are ‘at a fiscal crossroads’, says the Daily Telegraph. During their dismal election campaign, the Tories ‘failed to make the case for living within our means’ and the ‘public appetite for prudence’ appears to be waning. Yet for all the cheer from

British government may not be strong and stable but the economy is still the most formidable job creating machine in Europe. And while it’s certainly true that much of the rise in employment is down to immigration, British unemployment is also down – figures today show the lowest level since 1975. My old friend Simon Nixon writes in the Times today about Britain becoming the new basket case of Europe, and has been making similar noises since the Brexit vote. He may well he right, but so far this basket is carrying more jobs than at any time in history. Don’t expect the Tories to make this point: they’ve been out

Well, Arlene and Theresa have met for negotiations about the DUP/Tory deal that a million people got so exercised about, they signed an online petition to have it stopped. And you know what? There is no indication, not a whisper, since those talks broke up, that abortion was so much as mentioned; nor indeed gay marriage. Indeed, the whole notion that the DUP might be out to subvert gay marriage in mainland Britain, let alone do anything about the abortion laws (which undeniably need revisiting – tightening), was simply risible. So much for the scary talk from Ruth Davidson (who proclaimed that one of the things she put above party

Was the general election a vote against austerity? I was on the Today programme this morning to discuss this point, and in the course of the interview said that the lowest-paid did best under the Cameron years. This raised some degree of incredulity from Twitter, reported by Huffington Post. What planet am I on? I thought I’d answer. The Cameron years were tough, especially for those on welfare. But the aim was always to make people better-off by moving them into work. David Cameron did cut tax for employers, with corporation tax far lower. Liam Byrne, with whom I was on the Today programme, said that companies hoarded cash –

Sterling plunges on the currency markets. Middle Eastern oil money flees London. A Prime Minister resigns in mysterious circumstances, and a government clings on to a vanishing majority. Sound familiar? In fact, it is a description of the run up to the sterling crisis of 1976, which forced the Labour Government to crawl to the IMF for an emergency bail-out, rather than 2017. But the parallels are spooky. As a catastrophic election result for the Conservative party is digested, sterling is already sinking like a stone. No one has any real idea who will be PM in a few months, whether there will be another election, or who might win

The pound has plunged sharply on the exit poll, as markets start to come to terms with the idea that Theresa May might have blown it. It’s 1.7 per cent down against the dollar, 1.8 per cent against the Euro – expect those gains to deepen if tonight’s results confirm the results of the exit poll. For a simple reason: Theresa May asked for a general election to strengthen her hand in Brexit negotiations. If the public refuses to do so, she will be hugely weakened in the biggest negotiation that any Prime Minister has had to undertake. If, indeed, she survives long enough to undertake it – which is

Friday morning. A humbled looking Theresa May is muttering about how ‘defeat means defeat’, while Boris Johnson readies his leadership bid. Nicola Sturgeon is flying down to London with a list of demands for supporting a Labour-led coalition. And Jeremy Corbyn is finishing off some work on his allotment before hopping on a bus to the Palace. It might sound far-fetched. But the polls are so all over the place, it is no longer impossible that the Tories will lose their majority. If it happens, one point has been overlooked. Over in the City, stocks will be getting trashed, and the pound will be in free-fall. The markets have only just begun