Sturgeon says she is minded to cancel events involving crowds of more than 500 in Scotland – live news

Rolling coverage of the day’s political developments as they happenRishi Sunak’s morning post-budget interviews – SummaryBudget current spending plans not as generous as they appear, says IFS 1.56pm GMT The Institute for Fiscal Studies is holding its traditional day-after briefing on the budget. It started with an overview from Paul Johnson, its director, and the full text is now available on the IFS website.The OBR’s economic forecasts are a little more positive than the Bank’s, but they are still very weak even before factoring in possible longer term effects from the coronavirus. Projected growth rates averaging barely over one and a half per cent a year for the next five years are feeble and indicative of an economy that is not in a robust position for coping with shocks like the coronavirus. The OBR continues to assume an orderly move to a free trade agreement with the EU. Anything less orderly, or a failure to achieve such an agreement, would weaken an already weak economy even further.Only time will tell whether any of the numbers in this budget will have meaning once the economic effects of coronavirus become fully evident …If the long-term path of the economy is affected then [Sunak] will also need to reassess much more of his fiscal strategy when he returns to the despatch box in the autumn.Average annual increases of 2.8% sound substantial. Take account of the need to replace EU funding, and factor in planned increases for health, schools, defence and overseas aid, and there is relatively little here for other departments. If this spending envelope is stuck to there are plenty of public services which will not be enjoying much in the way of spending increases over the next few years.While austerity is clearly at an end in the sense that spending is rising, spending levels in many areas are set to remain well below 2010 levels for a long time to come. Expectations may be disappointed. 1.19pm GMT Here are two of the most striking charts from the Resolution Foundation’s report (pdf) on yesterday’s budget.The [Office for Budget Responsibility’s] medium-term outlook is dismal. [The chart below] shows cumulative real GDP growth over the five-year forecast period for each fiscal event since the OBR’s inception. As it makes plain, the OBR’s outlook in March 2020 is the second-weakest in its history, pipped only by its March 2018 prognosis. If yesterday’s forecast holds true, we estimate that the economy will have underperformed by almost one-quarter relative to the average five-year growth rate of the preceding decade. And the growth rates for the fourth and fifth years of the forecast are both the weakest on record. [The chart below] shows the overall impact of benefit and tax policy choices on households across the income distribution since summer budget 2015. Given that welfare support is targeted at lower-income households, and that the 2015 package of welfare cuts was so substantial (including the benefits freeze and two-child limit), the average losses for poorer households are very large. For example, the second decile will ultimately be £2,900 a year worse off (on average) than if welfare policy had remained unchanged, with £900 of that still to come as a result of welfare policies still being rolled out. Welfare cuts have been somewhat offset (in aggregate) by tax cuts. Successive cuts to income tax, through increases in the personal allowance and higher-rate threshold, have been followed in this budget by an increase in the starting point for national insurance, as well as repeated fuel duty freezes. But these changes have been of most benefit – in cash terms – to the top half of the income distribution, though this has been tempered at the very top by tax increases targeted at the richest tenth of the population. Continue reading…
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