British Government to Unveil New Budget
The British government is set to unveil the new budget tomorrow amid projections that the economy will shrink a further 4%. Though the details have yet to be revealed, what's clear is that it will be all about stripping down anything considered nonessential, which is sure to stir controversy: what one region considers wasteful, another will consider a necessity.
Managing public expectations is also key: how much should Chanceller of the Exchequer Alistair Darling promise to fix? Also, will the much-touted "green recovery" even be feasible? As bad as the recession has been, the state of British public funds was hardly rosy to begin with, and, as noted above, deficits are set to continue.
“We have to make sure that we are taking cost and efficiency measures to make spending affordable,” Business Secretary Peter Mandelson said. “We have to recognize that spending will not grow in the future as it has done in the past because of our need to stabilize the public finances.”
One pervasive concern is the fuel tax, which could increase for the third time in less than six months.
Motorists and the freight transport industry have already been hit by a 2.12 pence (inclusive of VAT) per litre rise in duty on petrol and diesel that came into force on April 1.