The UK economy continues to do well, despite current global uncertainties, according to Lord Jim O’Neill, commercial secretary to the Treasury. After the chancellor’s Autumn Statement, Lord O’Neill said “robust” data such as employment figures pointed towards growth.
“A key part of the Autumn Statement, the background for the Spending Review, is that the independent Office of Budget Responsibility (OBR) has made some upward revisions to its own view of the future and that sets the basis for the government’s fiscal choices,” Lord O’Neill said.
During his Autumn Statement yesterday, chancellor George Osborne announced the UK economy is expected to grow by 2.4 per cent this year, 2.4 per cent in 2016 and 2.15 per cent in 2017. He also stated that no economy in the G7 has grown faster than the UK in any year since 2010. The cited persistent weakness in the eurozone and the rising debt in emerging market economies, explaining expectations for world growth have been revised down due to these factors.
The slowdown of the Chinese economy and high levels of debt in emerging countries continue to be a risk for many economies, and the UK is one of them. Lord O’Neill, however, said the visit of China’s president, Xi Jinping, has brought the two countries together.
“As exhibited by the moods around president Xi’s visit, we are trying to deepen our bilateral economic ties,” Lord O’Neill said. “We recognise, notwithstanding China’s cylical economic changes, the rising importance of China economically in the world. If we want to rebalance our economy and become more successful at exporting, we have to be more successful in the most important places. Having a more successful exchange of foreign direct investment in both directions is a key driver.”
He further explained that the UK is also deepening ties with other emerging nations such as Brazil and India.
Other announcements made in the speech included a change to the state pension. The chancellor said he will increase the state pension age along with life expectancy in order to maintain a triple lock on the value of the state pension. The basic state pension will also go up by £3.35 to £119.30 a week and the full rate for the new state pension is set at £155.65.
A number of changes were also introduced to the housing market. Mr Osborne doubled the housing budget to £2bn a year as well as the promise to build 400,000 more affordable new homes. There will also be a 3 per cent higher stamp duty on purchase of additional properties such as buy-to-lets and second homes.
