Question to the HM Treasury:

To ask His Majesty's Government what is their response to the Institute for Fiscal Studies' assessment that (1) the Autumn Statement has extended the squeeze on public service spending to 2028–29, (2) the growth outlook has weakened, and (3) inflation is expected to stay higher for longer.

Total departmental spending in the next Parliament will continue to grow above inflation. Taken together with the significant increase (3.2% a year on average in real terms) in total departmental spending over the current Parliament, this means that total departmental spending will be £85 billion higher in real terms by 2028-29 than at the start of this Parliament (2019-20).

Earlier in the year many were predicting a recession, now the economy is growing in every year of the OBR forecast and the GDP level throughout the forecast is higher than forecast at Spring. The combined impact of Autumn Statement and Spring Budget policies are expected to permanently increase the size of the economy by 0.5% by the end of the forecast.

Inflation has been more persistent than the OBR forecast at Spring Budget 2023. The OBR has judged that high energy costs since Putin’s illegal invasion of Ukraine have had a more significant impact on inflation than it previously thought. However, we have met the PM’s priority to halve inflation this year, with inflation falling to 3.9% in November. The OBR says that Autumn Statement policies do not ‘have a material impact on the path of inflation’, and they slightly reduce inflation in 2024-25.