Skip to main content

IFS predicts UK finances will be '£25 billion worse off' by 2020

09 Nov 2016

The outlook for Britain's public finances has worsened by £25 billion since the March Budget, according to economic think tank the Institute for Fiscal Studies (IFS).

The IFS estimates that by 2019/20 a lower growth rate could see tax revenues fall by £31 billion compared to the forecast in this year's Budget, assuming financial policy remains the same.

This could be offset by £6 billion if the UK halts payments to the EU budget, but overall borrowing would be £25 billion more than forecast in the Budget.

This would be a deficit of £14.9 billion by 2020. The former Chancellor, George Osborne, had targeted a UK surplus of £10.4 billion by then.

The predictions come ahead of this month’s Autumn Statement and assume that all of the spending cuts previously announced by Mr Osborne can be delivered. However, the new Chancellor, Philip Hammond, has already indicated that he will prioritise spending on new homes and transport.

IFS research economist, Thomas Pope, said: ‘The new Chancellor's first fiscal event will not be easy. Growth forecasts are almost sure to be cut, leading to a significant increase in the deficit even if all the very challenging spending cuts currently planned are in fact delivered.’

The Bank of England recently raised its forecast for economic growth next year to 1.4% from 0.8%, but lowered growth expectations for 2018 from 1.8% to 1.5%.

The Chancellor will present the Autumn Statement on 23 November – we will be providing a full summary on our website.

100% Client Satisfaction Guarantee

At Arlington we love what we do. As proof of this, our staff will do everything to ensure that you receive the best, most reliable and professional service on the market.


Happy Clients

  • "Arlington offer sound business advice and have helped us to increase our turnover this year, whilst reducing our tax bill."
    Mr J McGillivray JM Yachting Limited.
  • "A big thank you to David and the rest of the team at Arlington. Always friendly and reliable. My accounts are dealt with quickly and efficiently and most importantly accurately. Something that wasn't happening when I was tying to produce them myself."
    Mr A Gilchrist Warrior Contracting Limited
  • "With our company growing, we are always getting into various situations where Arlington Accountants are always happy to offer us advice and guide our business to ensure more profits and lower tax payable".
    A. Elber - Director - Circuit Clubbing
  • "Its important to us to have the same people dealing with our affairs from one year to the next. Arlington Accountants take a very personal approach and offer great money saving advice."
    J Sheen - Director - Hambrook Holiday Park Limited
  • "Give Arlington a call now, you will not be wasting your time. They will improve your tax affairs and help you to change your mindset and lifestyle sooner than you think is possible".
    A. Elber - Director - Circuit Clubbing

View our client testimonials