The Office for Budget Responsibility (OBR) has projected that, over the five year period from 2016-17 to 2020-21, there has been an improvement of £27 billion in the underlying forecast since the July Summer Budget. This largely reflects higher expected receipts from income taxes, corporation tax and VAT, along with a slight upward revision to future UK GDP growth.
Since the Summer Budget, the impact of the Government’s overall decisions on tax and spending will add £18.7 billion to public sector borrowing over the five year period – significantly less than the £27 billion improvement reported by the OBR. Measures set out in the Autumn Statement ensure that public sector net debt continues to decline as a share of GDP in every year of the forecast, and the budget is still expected to reach a surplus of £10.1 billion in 2019-20.
