Ben Chu, the economics editor of BBC’s Newsnight, has reported that speculation is growing of one way the government may be looking to cut spending to improve the country’s finances.
He said speculation is growing that the chancellor might cut planned state capital spending (rather than day to day spending) in a move to reassure the markets.
Chu pointed out state investment is set to rise to around £70bn a year but noted a move back to the 2010-2019 average of £40bn would net around £30bn for the government.
Speculation swirling Chancellor might cut planned state capital spending (rather than day-to-day spending) to try to reassure markets.
State investment set to rise to around £70bn a year - big increase.
If taken back to 2010-19 average of £40bn would yield around £30bn...???? pic.twitter.com/Tmen6KPavN
— Ben Chu (@BenChu_) September 29, 2022
However, Chu added it is “important to note that most economists would argue this – infrastructure spending etc – is precisely the wrong spending to cut if the goal is to boost UK supply side and future productivity growth.”