Understandably, much of the focus on the autumn statement – the plan for the UK’s finances outlined by chancellor Jeremy Hunt on November 17 – is on its economic impact. But all economic policy making has considerable political significance.
The statement is the first major policy event of the Sunak government and it provides important pointers to the direction he intends to lead the country. What is also clear is that the statement creates considerable political and economic risks for his government in terms of internal party and electoral politics. So what can we take away from the statement to understand the leadership and ideas of the Sunak premiership?
The autumn statement highlights the political and economic difficulties that the government faces. The current outlook is not healthy, with Chancellor Jeremy Hunt confirming the UK is entering a recession. The Office for Budget Responsibility reports that living standards are shrinking – potentially by 7% over two years – and the economy faces sustained high levels of inflation. The government has to attempt restore the confidence of the international financial markets in its standing. At the same time, it needs to secure the support of voters facing lower living standards and poor public services.
