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The outlook for the public finances appears significantly weaker than the Treasury predicted in the November 2008 Pre-Budget Report (PBR). This will have an important bearing on the two key tax and spending decisions that Chancellor Alistair Darling will have to take in his Budget statement on 22 April: whether to announce an additional short-term stimulus to help support the economy and whether to announce an additional long- term tightening to help repair the public finances.
This Briefing Note sets out illustrative projections for the outlook for government borrowing and debt over the next few years. It then assesses by how much this or a future government might need to cut existing public spending plans and/or increase taxes to ensure that the outlook for public sector borrowing was no worse than that laid out in the PBR.
The analysis in this Briefing Note builds on the detailed forecasts in the January 2009 IFS Green Budget. It does not re-estimate the Green Budget forecasts, but instead makes some broad-brush adjustments to them to reflect new information and analysis available since the PBR.
View all IFS Briefing Notes in the series
Recent IFS Briefing Notes
The public sector workforce: past, present and future
In this briefing note, we combine various data sources to provide for the first time a consistent picture on how the size and composition of the public sector workforce has changed over the past 50 years.
Child and working-age poverty in Northern Ireland over the next decade: an update
This briefing note updates previous IFS projections of child and working-age poverty in Northern Ireland and the UK as a whole from 2012-13 to 2017-18, and in 2020-21.
Food expenditure and nutritional quality over the Great Recession
In this briefing note, we document how the food purchases of households in the UK have changed over the recent period of recession and food price rises.