UK economy to 'grow twice as fast' as Europe in 2025 on back of October Budget

[pellinore]

According to a leading bank's forecast, the UK economy is on track to expand twice as fast as its European peers next year thanks to the spending boosts introduced in October’s Budget.

Analysts at ING have pointed to an estimated growth of 1.4 per cent for Britain's gross domestic product (GDP) in the coming year, outlined in the bank’s annual economic outlook, meanwhile predicting a mere 0.7 per cent increase for the Eurozone economies, as reported by City AM.

The surge in the UK’s economic growth is largely attributed to the £40bn additional spending declared in Chancellor Rachel Reeves’ October Budget – a move that ING anticipates will translate into higher public sector wages and employment. "A lot of the [additional spending] is through extra departmental spending, [which] will inevitably end up in wages," according to ING’s UK economist James Smith, who adds: "That has quite a high fiscal multiplier compared to tax cuts... so I don’t think it’s that controversial to say the growth rate through the first half of next year will be a bit stronger."

UK economy to 'grow twice as fast' as Europe in 2025 on back of October Budget

Edited December 5, 2024 by pellinore

[stevewinn]

You need to read beyond the headline. I highlighted only yesterday to your good self that France and Germany are positing terrible economic numbers, So, the article states the UK economy is on track to expand twice as fast as its European peers, who the article names as - France & Germany. So of course Britain will out grow these two, as these are in decline, Germany is in existential decline.

 

[itsnotoutthere]

The writer of the piece :- https://www.alastairlyon.co.uk/   hmm...

[Duke Wellington]

11 hours ago, pellinore said:

According to a leading bank's forecast, the UK economy is on track to expand twice as fast as its European peers next year thanks to the spending boosts introduced in October’s Budget.

Analysts at ING have pointed to an estimated growth of 1.4 per cent for Britain's gross domestic product (GDP) in the coming year, outlined in the bank’s annual economic outlook, meanwhile predicting a mere 0.7 per cent increase for the Eurozone economies, as reported by City AM.

The surge in the UK’s economic growth is largely attributed to the £40bn additional spending declared in Chancellor Rachel Reeves’ October Budget – a move that ING anticipates will translate into higher public sector wages and employment. "A lot of the [additional spending] is through extra departmental spending, [which] will inevitably end up in wages," according to ING’s UK economist James Smith, who adds: "That has quite a high fiscal multiplier compared to tax cuts... so I don’t think it’s that controversial to say the growth rate through the first half of next year will be a bit stronger."

UK economy to 'grow twice as fast' as Europe in 2025 on back of October Budget

MSM story and on the UK Gov website that bank is not included in forecast statistics.

An extra £40bn in spending would increase demand, and therefore growth. But its not an increase, its a redistribution from the private sector. Therefore there has been no increase in spending, and worse its been put into the inefficient stake sector.

All that has happened is private sector employees wages have been cut (including employer NICs going up) to pay state sector employees extra. You do realise that? No extra money has been found anywhere, it will not increase demand, it will reduce it a little. I disagree with some who predict a recession, I`m going to predict low or stagnant growth. For now at least, depends if there are more wage rises coming for state employees. 

[Duke Wellington]

7 hours ago, itsnotoutthere said:

The writer of the piece :- https://www.alastairlyon.co.uk/   hmm...

There searched wide and far to find someone reporting in favour of the budget lol.

[Setton]

9 hours ago, Duke Wellington said:

MSM story and on the UK Gov website that bank is not included in forecast statistics.

An extra £40bn in spending would increase demand, and therefore growth. But its not an increase, its a redistribution from the private sector. Therefore there has been no increase in spending, and worse its been put into the inefficient stake sector.

All that has happened is private sector employees wages have been cut (including employer NICs going up) to pay state sector employees extra. You do realise that? No extra money has been found anywhere, it will not increase demand, it will reduce it a little. I disagree with some who predict a recession, I`m going to predict low or stagnant growth. For now at least, depends if there are more wage rises coming for state employees. 

As I've already told you, public sector pay rises typically have to be funded out of existing funding settlements, by finding efficiencies. There's typically no extra cash from private sector or anywhere else.

I'd have thought you'd be in favour of improving public sector pay. Given you're so sure we're all inefficient incompetents, better pay will attract those oh so excellent private sector employees into the public sector.

[Duke Wellington]

4 hours ago, Setton said:

As I've already told you, public sector pay rises typically have to be funded out of existing funding settlements, by finding efficiencies. There's typically no extra cash from private sector or anywhere else.

I'd have thought you'd be in favour of improving public sector pay. Given you're so sure we're all inefficient incompetents, better pay will attract those oh so excellent private sector employees into the public sector.

I`m in favour of shrinking the state sector to the smallest the UK can get away with.

All that money saved should then come off corporate tax rate, employer NICs, employee NICs. Now that would create growth. 

[itsnotoutthere]

Bosses 'immediately reacted' to Autumn Budget with job cuts, data suggests

Bosses appeared to ‘immediately react’ to the Chancellor’s Autumn Budget by cutting staff, data from Employment Hero’s SmartMatch Salary Report suggests.

Rachel Reeves's £25billion National Insurance raid on employers has been criticised by some businesses, which will pay 1.2 per cent more per employee from April.

British firms will also have to contend with an increase in the National Minimum Wage.

Full-time employment contracted by 1.2 per cent in November, according to Employment Hero’s poll of 90,000 employees, with younger workers worst affected.

The HR software firm said there were 4.8 per cent fewer 18-24 year olds in full-time work last month when compared to October, in contrast to a 0.5 per cent month-on-month decline for 35-44 year olds.

It follows data from the Bank of England on Thursday that found 54 per cent of companies are likely to employ fewer staff, as well as hike prices, in response to the Autumn Budget.

https://www.msn.com/en-gb/money/other/bosses-immediately-reacted-to-autumn-budget-with-job-cuts-data-suggests/ar-AA1vohRo?ocid=BingHp01&cvid=fa8ff49333b6433a95ef2df9103f1abe&ei=14#

[Setton]

3 hours ago, Duke Wellington said:

I`m in favour of shrinking the state sector to the smallest the UK can get away with.

All that money saved should then come off corporate tax rate, employer NICs, employee NICs. Now that would create growth. 

Sure.

And what size is that? Give us some figures to work with.

[stevewinn]

23 minutes ago, Setton said:

Sure.

And what size is that? Give us some figures to work with.

Seeing how we ran an empire on around 30,000 civil servants, and now we only run a country on around 550,000.

Public sector is what 5 or 6 million, We'll have to do an Elon. get each employee in giving them 5mins to state what they've done in the last 12months.

Was you surprised by Free gear having a right go at the civil service? Funny that we were only talking about this last month.

How many would you say would be a lean number for value?

 

[Duke Wellington]

27 minutes ago, Setton said:

Sure.

And what size is that? Give us some figures to work with.

Lets put everyone in the UK on a Universal Basic Income:

1. For those unemployed they get 37.5 hours per week on the full Universal Basic Income. However, they get assigned a job they must do 4 days per week with no extra pay, until they have found their own employment. Those jobs should be either physically hard, carry some risk, or be psychologically deeming, to make sure they don`t want to stay in them. We are talking toilet cleaning, conscripts, fast food assistants, wiping bums at hospitals, etc.

2. Those in minimum wage positions get no wages from their employers. Instead, of employee and employer NICs, and instead of income tax, the business simply pays a consolidated tax to the state from their employment. That is set at a rate to cover the employees Universal Basic Income.

3. For those earning above the national minimum wage, get rid of employee and employer NICs, and just incorporate it all into income tax. The person pays one consolidated tax, on their extra income. Everything up to the minimum wage is still replaced with Universal Basic Income, and taxed to the business.

So, we have just simplified having 101 benefits and lots of taxes. We essentially have one benefit - Universal Basic Income, and two taxes - Corporate Employment Tax, and Employer NICs (for higher earners). Heck, if a doctor signs it off even the mobility scooters and stuff can be added to Universal Basic Income.

By simplifying how taxation is done, and putting the majority of the population onto Universal Basic Income, the need for Civil Servants decreases. Most of the population would be on Universal Basic Income which will do automated payments for most of their lives. Some civil servants would still be needed to add people on when they enter the workforce, and take them off when they die, and process the extras like mobility scooters or care home costs. But the need for all those Civil Servants handling Universal Credit would decrease dramatically. 200,000 could be laid off as they have been replaced by a automated Universal Basic income payment system. Heck, that can even be outsourced.

All the savings could then be spent elsewhere.

[Duke Wellington]

2 minutes ago, stevewinn said:

Seeing how we ran an empire on around 30,000 civil servants, and now we only run a country on around 550,000.

Public sector is what 5 or 6 million, We'll have to do an Elon. get each employee in giving them 5mins to state what they've done in the last 12months.

Was you surprised by Free gear having a right go at the civil service? Funny that we were only talking about this last month.

How many would you say would be a lean number for value?

They haven`t culled those taken on during coronavirus.

But far fewer people are now on Universal Credit. Sack 95% of them, they arent needed. Just watch the Labour Party try to keep them by flooding the state with more immigrants to justify their need.

Edited December 6, 2024 by Duke Wellington

[Setton]

6 hours ago, Duke Wellington said:

Lets put everyone in the UK on a Universal Basic Income:

1. For those unemployed they get 37.5 hours per week on the full Universal Basic Income. However, they get assigned a job they must do 4 days per week with no extra pay, until they have found their own employment. Those jobs should be either physically hard, carry some risk, or be psychologically deeming, to make sure they don`t want to stay in them. We are talking toilet cleaning, conscripts, fast food assistants, wiping bums at hospitals, etc.

2. Those in minimum wage positions get no wages from their employers. Instead, of employee and employer NICs, and instead of income tax, the business simply pays a consolidated tax to the state from their employment. That is set at a rate to cover the employees Universal Basic Income.

3. For those earning above the national minimum wage, get rid of employee and employer NICs, and just incorporate it all into income tax. The person pays one consolidated tax, on their extra income. Everything up to the minimum wage is still replaced with Universal Basic Income, and taxed to the business.

So, we have just simplified having 101 benefits and lots of taxes. We essentially have one benefit - Universal Basic Income, and two taxes - Corporate Employment Tax, and Employer NICs (for higher earners). Heck, if a doctor signs it off even the mobility scooters and stuff can be added to Universal Basic Income.

By simplifying how taxation is done, and putting the majority of the population onto Universal Basic Income, the need for Civil Servants decreases. Most of the population would be on Universal Basic Income which will do automated payments for most of their lives. Some civil servants would still be needed to add people on when they enter the workforce, and take them off when they die, and process the extras like mobility scooters or care home costs. But the need for all those Civil Servants handling Universal Credit would decrease dramatically. 200,000 could be laid off as they have been replaced by a automated Universal Basic income payment system. Heck, that can even be outsourced.

All the savings could then be spent elsewhere.

I've argued for UBI for years. You've always been opposed previously.

@stevewinn This links to my answer to you. First place if make cuts is HMRC. It's the peak of insanity to me that I'm paid my salary from public finances, which HMRC then take tax off, which they use to partly pay the person calculating that tax and partly to pay me, which gets taxed, which.........and so on.

Just scrap tax on public sector salaries and pay the take home income. Good chunk of HMRC no longer needed right there.

[Setton]

6 hours ago, stevewinn said:

Seeing how we ran an empire on around 30,000 civil servants, and now we only run a country on around 550,000.

I think it's fair to say the country we live in today is a rather different one to the British empire.

Unless you want to go back to workhouses, debtors prisons and cholera, not much of an equivalency to draw.

Your figure is also completely misleading as those who administered the empire's colonies (functionally civil servants) were not actually classed as civil servants. 

Quote

Public sector is what 5 or 6 million, We'll have to do an Elon. get each employee in giving them 5mins to state what they've done in the last 12months.

No issue with that but I think you'd be surprised at the answers. For one, there's no way I could condense my last 12 months into 5 mins. And that's for someone who has a clue what they're talking about!

Quote

Was you surprised by Free gear having a right go at the civil service? Funny that we were only talking about this last month.

Not really. It's exactly what I said, isn't it? Pay rises will need to be funded through efficiencies, not taxes. 

Quote

How many would you say would be a lean number for value?

See this is where we differ. Neither of us has enough information to make an informed assessment on this. The difference is, I therefore won't, while you'll make an uninformed assumption based on your preconceptions.

[Duke Wellington]

1 hour ago, Setton said:

I've argued for UBI for years. You've always been opposed previously.

@stevewinn This links to my answer to you. First place if make cuts is HMRC. It's the peak of insanity to me that I'm paid my salary from public finances, which HMRC then take tax off, which they use to partly pay the person calculating that tax and partly to pay me, which gets taxed, which.........and so on.

Just scrap tax on public sector salaries and pay the take home income. Good chunk of HMRC no longer needed right there.

Consolidate and make it efficient.

I`m opposed to socialism but if a UBI cuts state expenditure without costing businesses anything extra, I`m all for it. It also ends all unemployment, every job gets filled.

A company can handle its own recruitment but after a couple of weeks if they cannot fill it, they can request someone to be supplied, and they have to do it 4 days per week or no UBI.

Edited December 7, 2024 by Duke Wellington