Latest news with #Richard Hughes
Bloomberg
3 days ago
- Business
- Bloomberg
Tax Hikes Insufficient to Fix UK Debt Spiral, OBR Chair Says
The head of Britain's budget watchdog warned that tax increases may not be enough to bring the UK's spiraling debt burden under control since the strategy could backfire by slowing the economy. In testimony to the Treasury Select Committee, the Office for Budget Responsibility Chair Richard Hughes told Members of Parliament that greater efforts are needed to reduce the government's debt as a share of GDP and prepare for the next crisis. But he warned 'higher and higher levels of taxes are not good for growth.'
The Independent
4 days ago
- Business
- The Independent
OBR boss denies forecast drove welfare cut proposals
The Chancellor could have met her fiscal rules without proposing £5 billion worth of welfare cuts, the head of the Office for Budget Responsibility (OBR) has said. Richard Hughes rejected the suggestion that the OBR's forecast was now driving policy, saying it was up to chancellors to decide how much headroom they wanted against their targets. In March 2025, it was reported that Rachel Reeves had expanded planned cuts to welfare shortly before her spring statement after the OBR forecast the Government's previous proposals would not save as much money as thought. That enabled her to maintain the £9.9 billion of headroom against her debt target that she set out in her October 2024 budget. But it also prompted an outcry from Labour backbenchers, leading to the Government dropping most of the proposals in order to avoid its first Commons defeat. Appearing before the Commons Treasury Committee on Tuesday ahead of his proposed reappointment as the OBR's chairman, Mr Hughes denied that changes in the OBR forecast had driven the proposed welfare changes. He said: 'I don't really accept the characterisation that it was changes in our forecast that forced the Government to make any particular sort of policy decision. 'Back in March, the Government decided to make £5 billion worth of welfare savings. They had £10 billion worth of headroom against their fiscal rule. They could have settled for five.' Mr Hughes went on to characterise the decision on welfare, which has now been largely reversed, as 'an entirely political choice' and added Ms Reeves could also have decided to break or change her fiscal rules. Asked about a perception that the forecast was now driving policy, he said: 'Chancellors can make a point about how much headroom they want against their fiscal rules. Recently they have left themselves very little.' Mr Hughes also pushed back against criticism from the Prime Minister, who had complained to the Commons Liaison Committee in April that the OBR's forecast had not included the effect of the Government's welfare reforms on employment. He said the Government had failed to provide enough detail on the employment support programme for it to be included, saying: 'There were no specifics. 'They couldn't tell us who was going to benefit from this programme, which groups, what kind of support they were going to get. 'There was no policy for us to score in our forecast.' A series of U-turns on the Government's welfare proposals at the start of July have left the Chancellor looking for another £5 billion in savings or tax rises if she wishes to maintain the headroom against her debt target she had last year. Ms Reeves is also likely to face a further squeeze thanks to a weakening economy and a commitment to partially reverse cuts to the winter fuel allowance.
The Sun
4 days ago
- Sport
- The Sun
Richard Hughes' tears at Newmarket show there really is hope for all in racing this season
HOPE. That's what we all need. And for those battling the superpowers in the world of horse racing hope is everything. 1 The good news is this season there is hope emerging on many different levels. Most recently, of course, Richard Hughes banged in Saturday's Group 1 July Cup at Newmarket. That will have given Hughes hope, and many other trainers will be thinking 'it could be me next'. But it's been a Flat season where Hughes - who was in tears during an emotional interview with me moments after his biggest win - is not the only one to have hit the jackpot. Docklands banged in the Group 1 Queen Anne at Royal Ascot for Harry Eustace. That's massive for the young up-and-coming handler, and while the horse is owned by a group with plenty of cash to splash, it still gives everyone hope. Eustace, of course, doubled up in Group 1s by also banging in the Commonwealth Cup with Time for Sandals. And don't forget old Scotsman Jim Goldie, who was responsible for American Affair taking the Group 1 King Charles III Stakes, also at Royal Ascot. Don't also forget the Irish raider Cercene, who took the Coronation Stakes and a first Group 1 for both trainer Joe Murphy and jockey Gary Carroll. Why is this so important? After all sport is just about finding out who is best of the best, it's not about who is actually taking the prizes. Well it's crucial because, as I have said, everyone needs hope. Other than those I have mentioned, group 1 races in the UK so far in 2025 have gone to Ruling Court, Desert Flower, Lead Artist, Jan Brueghel, Minnie Hawk, Lambourn, Field of Gold, Ombudsman, Trawlerman, Lazzat, Delacroix and Cinderella's Dream. The owners of that lot are some of the richest people in the world in Dubai, Saudi Arabia, Ireland and Qatar. Godolphin, Juddmonte, Coolmore and Wathnan Racing cough up more money than most for horses. For most people matching them is the stuff of dreams. But there is not only hope in what has happened in Group 1 races this term. Eve Johnson Houghton is also giving people hope, as is Jonny Portman, who is having a fantastic season headed by horses like Rumstar and had a terrific treble at Newbury the other day. He's trading at 20 per cent with a massive 28 victories this season. Since he started training in 1998 the most victors he has ever had in a campaign has been 33. Portman is on fire. Eve landed the Group 2 Kingdom of Bahrain July Stakes with Zavateri and also enjoyed success at Royal Ascot thanks to Havana Hurricane in the Listed Havana Hurricane. Superpowers are needed in every sport to inject cash. But for the people just below the mega players hope is so important. And this is a Flat season of hope for all. Commercial content notice: Taking one of the offers featured in this article may result in a payment to The Sun. You should be aware brands pay fees to appear in the highest placements on the page. 18+. T&Cs apply. Remember to gamble responsibly A responsible gambler is someone who:
Yahoo
12-07-2025
- Business
- Yahoo
Faisal Islam: We are heading for significant tax rises
Two very different reports have reignited UK economic gloom over the past four days. Friday's economic figures showed a further monthly dip in UK growth, or GDP, in May. Earlier this week the official forecaster, the Office for Budget Responsibility (OBR), said Britain faced "daunting" risks, including the possibility that levels of government debt could soar to three times the size of the economy. Two very different timescales - the economy in a single month, and the public finances in half a century's time. At another moment both might have been largely ignored. Monthly GDP figures are notoriously volatile, and what does a debt forecast for 2075 even begin to mean? What would the Treasury forecast from 1975 tell us about this year? But these very different charts are setting the tone for some tricky judgements required by autumn and tough calls about what happens in the next half decade. The really unusual thing about the OBR's long-term risk and sustainability report was the strength of the words from its boss Richard Hughes. "The UK cannot afford the array of promises that are displayed to the public," based on reasonable assumptions about their cost and growth, he said. The report also cited a pattern, over multiple governments, of U-turns on tax and spending changes. It came within days of the government's reverses over welfare savings and the winter fuel payment. Among 36 advanced economies, the UK now has the sixth highest debt, the fifth highest annual borrowing, and the third highest borrowing costs leaving it "vulnerable", when compared to other countries, to future crises, the OBR found. The clear message was that repeatedly borrowing more is not a long-term solution to rising day-to-day spending pressures. Yet the pressure to spend more may prove stubborn, thanks to geopolitical and societal changes. The OBR's existing forecasts assume that the post-pandemic surge in incapacity and disability cases will fall half way back to normal by 2029. This is very uncertain. Local councils are now spending 58% of their revenue on social care for adults and children, with some councils spending more than 80%. A £4.6bn special financial arrangement to deal with ballooning special educational needs budgets risks mass local authority bankruptcy. The promise to increase defence spending to the new Nato target of 3.5% will cost nearly £40bn per year by 2035. The OBR's report was basically a polite plea for some realism about the choices ahead. A government with a massive majority and four more years would normally be expected to have the strength to make these sorts of decisions. As pointed out before the last election, there was little attempt to level with the public, especially over taxation. The big picture is that this autumn's Budget may see £10bn to £20bn of further tax rises. On top of this, Trump's tariffs have triggered profound uncertainty. That has pushed up UK government borrowing costs. But they are also prompting a more fundamental shift in the foundations of the global economic system, with the dollar and US government debt no longer treated as unbreachable safe havens. So how might the chancellor respond to these challenges? She may choose to rebuild the so-called "headroom" to give her a better chance of meeting her self-imposed borrowing limits. Currently that buffer is a very tight £10bn. Reeves has said she will stick to her plans to not borrow to fund day-to-day spending and to get government debt falling as a share of national income by 2029/29, despite some concern from MPs. But she is considering the International Monetary Fund's advice to only adjust her plans once a year, rather than in both spring and autumn. But there may still need to be a kitchen sink approach to this autumn's Budget, with the chancellor throwing everything she has at fixing the public finances. Ministers have not abandoned the idea of finding savings in the health-related welfare bill. A discussion is opening up about whether the Personal Independence Payment (Pip) benefit, designed to help pay for physical equipment, is the right vehicle to manage the specific surge in mental ill health. On the other hand, while politicians acknowledge the cost of the state pension triple lock is far higher than originally forecast, that policy seems to be utterly politically impregnable. So we are heading for significant tax rises. The expected further freeze on income tax thresholds will not be enough. The noise around wealth taxes points to property and inheritance taxation, as baby boomers start a mass transfer of trillions of pounds of housing equity to their children. Expect the Treasury to think very hard about what size of net it might lay in the water to ensnare bountiful revenues, aimed at funding the costs of an ageing society without levying that burden entirely on working households. Of course the great hope is the return of robust economic growth to smooth the way. Reeves' fiscal rules have left space for longer term investments in infrastructure, although the planning reforms will take some time to yield a construction boom. The UK's position as a comparatively stable island in a sea of trade tumult, should also yield dividends. Some of the world's most important business people, such as Jensen Huang of Nvidia, were falling over themselves to praise the UK's investment potential for frontier tech. The very latest economic news does contain some perking-up in levels of confidence over the past few weeks, and more interest rate cuts are on the way. Some City economists say the gloom is overdone and we are "past the worst". UK stock markets and sterling remain strong. So that is the long-term challenge laid down by the OBR, balance the books and boost the economy. A government that should still have four years of a thumping majority has the necessary power, but the past month has raised concerns about its authority. Reeves disappointed after economy unexpectedly shrinks Reeves' five choices to turn government finances around Faisal Islam: How much will U-turn on disability benefits cost? Error in retrieving data Sign in to access your portfolio Error in retrieving data
BBC News
12-07-2025
- Business
- BBC News
Rachel Reeves autumn Budget will see significant tax rises
Two very different reports have reignited UK economic gloom over the past four days. Friday's economic figures showed a further monthly dip in UK growth, or GDP, in May. Earlier this week the official forecaster, the Office for Budget Responsibility (OBR), said Britain faced "daunting" risks, including the possibility that levels of government debt could soar to three times the size of the very different timescales - the economy in a single month, and the public finances in half a century's another moment both might have been largely ignored. Monthly GDP figures are notoriously volatile, and what does a debt forecast for 2075 even begin to mean? What would the Treasury forecast from 1975 tell us about this year?But these very different charts are setting the tone for some tricky judgements required by autumn and tough calls about what happens in the next half really unusual thing about the OBR's long-term risk and sustainability report was the strength of the words from its boss Richard Hughes."The UK cannot afford the array of promises that are displayed to the public," based on reasonable assumptions about their cost and growth, he report also cited a pattern, over multiple governments, of U-turns on tax and spending came within days of the government's reverses over welfare savings and the winter fuel 36 advanced economies, the UK now has the sixth highest debt, the fifth highest annual borrowing, and the third highest borrowing costs leaving it "vulnerable", when compared to other countries, to future crises, the OBR clear message was that repeatedly borrowing more is not a long-term solution to rising day-to-day spending pressures. Yet the pressure to spend more may prove stubborn, thanks to geopolitical and societal OBR's existing forecasts assume that the post-pandemic surge in incapacity and disability cases will fall half way back to normal by is very uncertain. Local councils are now spending 58% of their revenue on social care for adults and children, with some councils spending more than 80%.A £4.6bn special financial arrangement to deal with ballooning special educational needs budgets risks mass local authority promise to increase defence spending to the new Nato target of 3.5% will cost nearly £40bn per year by 2035. Time to level The OBR's report was basically a polite plea for some realism about the choices ahead.A government with a massive majority and four more years would normally be expected to have the strength to make these sorts of pointed out before the last election, there was little attempt to level with the public, especially over big picture is that this autumn's Budget may see £10bn to £20bn of further tax top of this, Trump's tariffs have triggered profound uncertainty. That has pushed up UK government borrowing costs. But they are also prompting a more fundamental shift in the foundations of the global economic system, with the dollar and US government debt no longer treated as unbreachable safe havens. Kitchen sink Budget So how might the chancellor respond to these challenges?She may choose to rebuild the so-called "headroom" to give her a better chance of meeting her self-imposed borrowing limits. Currently that buffer is a very tight £ has said she will stick to her plans to not borrow to fund day-to-day spending and to get government debt falling as a share of national income by 2029/29, despite some concern from she is considering the International Monetary Fund's advice to only adjust her plans once a year, rather than in both spring and there may still need to be a kitchen sink approach to this autumn's Budget, with the chancellor throwing everything she has at fixing the public finances. Ministers have not abandoned the idea of finding savings in the health-related welfare bill.A discussion is opening up about whether the Personal Independence Payment (Pip) benefit, designed to help pay for physical equipment, is the right vehicle to manage the specific surge in mental ill the other hand, while politicians acknowledge the cost of the state pension triple lock is far higher than originally forecast, that policy seems to be utterly politically impregnable. Netting revenue So we are heading for significant tax rises. The expected further freeze on income tax thresholds will not be noise around wealth taxes points to property and inheritance taxation, as baby boomers start a mass transfer of trillions of pounds of housing equity to their the Treasury to think very hard about what size of net it might lay in the water to ensnare bountiful revenues, aimed at funding the costs of an ageing society without levying that burden entirely on working course the great hope is the return of robust economic growth to smooth the way. Reeves' fiscal rules have left space for longer term investments in infrastructure, although the planning reforms will take some time to yield a construction boom. The UK's position as a comparatively stable island in a sea of trade tumult, should also yield of the world's most important business people, such as Jensen Huang of Nvidia, were falling over themselves to praise the UK's investment potential for frontier tech. The very latest economic news does contain some perking-up in levels of confidence over the past few weeks, and more interest rate cuts are on the way. Some City economists say the gloom is overdone and we are "past the worst". UK stock markets and sterling remain that is the long-term challenge laid down by the OBR, balance the books and boost the economy. A government that should still have four years of a thumping majority has the necessary power, but the past month has raised concerns about its authority.
