Office for Budget Responsibility

Office for Budget Responsibility

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The Office for Budget Responsibility was established to provide independent and authoritative analysis of the UK's public finances. Part of this role includes producing the official economic and fiscal forecasts. This report sets out forecasts for the period to 2016-17. The report also assesses whether the Government is on course to meet the medium-term fiscal objectives. The OBR assessment of the outlook and risks for the UK economy is broadly unchanged since the November 2011 report. A technical recession will be avoided with positive growth in the first quarter of 2012. GDP will grow by 0.8% in 2012, 2% in 2013, 2.7% in 2014 and 3% for 2015-16 period. Public sector net borrowing is forecast to total Ap126 billion, 8.3% of GDP this year which is Ap1.1 billion less than the November forecast. For 2016-17, the PSNB is then forecast to decline to Ap21 billion. The fall in PSNB in 2012-13 is much larger than the OBR's November forecast due to the Government's decision to transfer the Royal Mail's historic pension deficit. The Chancellor's decision to cut 50% additional rate income tax to 45% has an estimated direct cost to the Exchequer of Ap0.1 billion in 2013-14. Other forecasts by the OBR, include: the ILO unemployment rate to rise from 8.4% to 8.7% over the coming year; household disposable income growth to be weak in 2012-13, but consumption to begin to offer some support to the recovery in the second half of the year; that the situation in the euro area remains a major risk to accurate forecasting. The publication is divided into five chapters: Chapter 1: Executive summary; Chapter 2: Developments since the November 2011 forecast; Chapter 3: economic outlook; Chapter 4: Fiscal outlook; Chapter 5: Performance against the Government's fiscal targest; Annex A - Budget 2012 policy measures.... expenditure since November forecast Qbillion Outturn Forecast 2010-112011- 12 2012-13 2013-14 2014-15 2015-16 ... 3 0.1 -0.3 -1.0 -1.0 -1.8 0.0 1.0 Tax credits 2 0.1 -0.1 -0.4 -0.5 -0.3 -0.5 -0.6 Net public service pension payments 0.0 0.0 1.7 1.7 ... 0.5 Central government gross debt interest 0.0 -0.2 -2.3 -4.3 -2.9 - 2.0 -1.5 Depreciation 0.0 -0.2 -0.2 -0.2 -0.2 -0.1 -0.1 ... Calculated as the difference between Resource AME and PSCE in the case of Resource DEL, and between Capitalanbsp;...

Title:Office for Budget Responsibility
Author:Office for Budget Responsibility, Great Britain. Office for Budget Responsibility
Publisher:The Stationery Office - 2012


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