Fiscal policy Over-ruled? Assessing the options for changing the fiscal rules 4 October 2024 by Cara Pacitti and James Smith Although the Chancellor said she would stick with the previous Government’s much-criticised rule of reducing public debt in the fifth year of the forecast, Rachel Reeves’s conference speech has sparked a debate about whether the fiscal rules should be changed to allow the Government to borrow more. Three options have been mooted for changing the … Continued READ MORE
Monetary policy· Fiscal policy· Macroeconomic policy Crunch time Bank of England raises rates again and signals cost of living crisis is set to deliver a £1,200 hit to incomes 5 May 2022 by Adam Corlett and Jonathan Marshall and James Smith Today the Bank of England’s Monetary Policy Committee raised rates at a fourth successive meeting – a first in the 25 years since it was granted independence – to 1 per cent, a level not seen since the financial crisis. The direct impact of this change in rates on households will be small in the … Continued READ MORE
Covid-19· Fiscal policy· Economy and public finances· Tax· Macroeconomic policy Unhealthy finances How to support the economy today and repair the public finances tomorrow 11 November 2020 by George Bangham and Adam Corlett and Jack Leslie and Cara Pacitti and James Smith This report provides analysis of the dual challenges faced by the government: ensuring that there is sufficient fiscal support through the crisis and recovery, and setting fiscal policy on a sustainable long-term path. Some argue it is unsustainable to provide the massive government support during the crisis, while others see little constraint on government borrowing … Continued READ MORE
Covid-19· Fiscal policy· Macroeconomic policy Act now, or pay later The OBR’s Fiscal Sustainability Report makes clear the implications of a crisis-driven rise in unemployment for the public finances 14 July 2020 by James Smith and Cara Pacitti and Jack Leslie The OBR’s latest Fiscal Sustainability Report confirms its view that the current crisis could lead to the largest economic contraction in 300 years precipitating a return of unemployment levels not since the 1980s. Given the huge uncertainty, the OBR has produced three scenarios with different assumption about a timetable for finding a vaccine or other … Continued READ MORE
Covid-19· Budgets & fiscal events· Fiscal policy· Economy and public finances· Macroeconomic policy Summer Economic Update July 2020 Resolution Foundation overnight analysis 9 July 2020 by Resolution Foundation Analysis This was not a Budget, but was still a big deal with £30bn of measures to support the economy. This is particularly significant when seen in combination with £160bn of pandemic-related support already announced, leaving borrowing this year on course to reach £350bn. Debt interest costs will continue to fall, although the crisis will leave … Continued READ MORE
Covid-19· Labour market· Fiscal policy· Economy and public finances· Macroeconomic policy Doing more of what it takes Next steps in the economic response to coronavirus 16 April 2020 by Richard Hughes and Jack Leslie and Charlie McCurdy and Cara Pacitti and James Smith and Daniel Tomlinson The Government has responded to coronavirus by shutting down large parts of the UK economy, and socialising the costs of doing so through a package of fiscal support to firms and individuals unprecedented in size and scope. Given uncertainty about how long public health restrictions will need to be in place, economic policy makers need to be prepared to manage what could … Continued READ MORE
Covid-19· Fiscal policy· Economy and public finances· Macroeconomic policy Safeguarding governments’ financial health during coronavirus What can policymakers learn from past viral outbreaks? 25 March 2020 by Richard Hughes In the wake of the coronavirus outbreak, governments have taken unprecedented steps to protect the health of their citizens and support their economies. They now need to take extraordinary steps to safeguard their own financial health through what could be a protracted period of economic disruption necessary to contain and eradicate the virus. This paper … Continued READ MORE
Public spending· Fiscal policy· Economy and public finances· Macroeconomic policy· Political parties and elections Playing by their own rules? We analyse whether the policy platforms announced by the main parties are consistent with their own fiscal rules 28 November 2019 by Richard Hughes and Jack Leslie and Cara Pacitti and James Smith Fiscal rules are crucial for the government’s stewardship of the public finances and framing its economic priorities. So it is welcome that the main parties have prioritised setting out the rules they would follow, with their announcements following to different degrees the approach recommended by earlier Resolution Foundation work. But fiscal rules are only useful … Continued READ MORE
Social care· Fiscal policy· Welfare· Political parties and elections The shifting shape of social security Charting the changing size and shape of the British welfare system 26 November 2019 by Laura Gardiner Voters face a stark choice in the 2019 election about the social security system they want. This report examines how the provision of social security in Britain has changed; the big trends that current social security policy needs to take account of; and the policy offer from our three main political parties. READ MORE
Fiscal policy· Economy and public finances· Political parties and elections The shape of things to come Charting the changing size and shape of the UK state 4 November 2019 by Matthew Whittaker This report marks the first in a series of pre-election pieces that focus on the fiscal backdrop to the vote. It takes a long-run view of the size and shape of government spending in the UK, and considers how things might change under the next government. READ MORE
Fiscal policy· Macroeconomic policy Totally (net) worth it The next generation of UK fiscal rules 29 October 2019 by Richard Hughes and Jack Leslie and Cara Pacitti and James Smith The UK needs new fiscal rules which put improving net worth at the centre, enable the government to borrow to invest, are robust to a wide range of scenarios, and allow fiscal policy to play a lead role in stabilising the economy. READ MORE
Fiscal policy· Macroeconomic policy Britannia waives the rules? Lessons from UK and international experience with fiscal rules 21 October 2019 by Richard Hughes and Cara Pacitti and Jack Leslie The UK’s current fiscal rules will expire in 2020-21 and all major political parties have committed to replacing them. This paper explores the lessons from UK and international experience that can help set the UK’s next generation of fiscal targets. READ MORE
Fiscal policy· Economy and public finances· Macroeconomic policy Seeking public value The case for balance sheet targeting in fiscal policy 29 September 2019 by Richard Hughes With the government’s current fiscal rules set to expire next year, this paper makes the case for government’s next fiscal framework to move beyond the narrow focus on debt and include a target which encompasses its entire balance sheet of assets and liabilities. READ MORE
Fiscal policy· Economy and public finances· Macroeconomic policy Dealing with ‘no deal’ The economic policy response to a ‘no deal’ Brexit 19 September 2019 by Richard Hughes and Jack Leslie and Cara Pacitti and James Smith This report provides a framework for understanding what role macroeconomic policy can play in alleviating the economic impact of a ‘no deal’ Brexit. READ MORE
Fiscal policy· Macroeconomic policy Recession ready? Assessing the UK’s macroeconomic framework 9 September 2019 by James Smith and Jack Leslie and Cara Pacitti and Fahmida Rahman This report is the launch paper for the Resolution Foundation’s Macroeconomic Policy Unit. It provides the most comprehensive assessment of the UK’s macroeconomic policy framework since the financial crisis, focusing on the ability of the framework to provide effective support to the economy in the face of the next recession. This work is important, given … Continued READ MORE
Fiscal policy· Macroeconomic policy A problem shared? What can we learn from past recessions about the impact of the next across the income distribution? 5 August 2019 by James Smith and Cara Pacitti While the received wisdom from the 1980s and 1990s recessions was that those at the bottom of the income distribution suffer most during severe downturns. But this was less obvious in the aftermath of the financial crisis. So this briefing note looks at what lessons we can learn from that episode about the distributional impact … Continued READ MORE
Public spending· Fiscal policy· Economy and public finances Shape shifting: the changing role of the state during fiscal consolidation 10 November 2015 by Matthew Whittaker and Adam Corlett and David Finch Resolution Foundation’s latest analysis looks at the changing size and shape of the state and what decisions the government will need to make going forward. READ MORE
