UK unveils less bleak-than-expected budget during massive strike

UK unveils less bleak than expected budget during massive strike

London on Wednesday (March 15th) unveiled a budget focused on its aim to entice thousands of Britons back into the job market in the face of labor shortages. But faced with the severe crisis in the cost of living in the country, a new day of massive strikes was announced.

British Finance Minister Jeremy Hunt estimated Wednesday at 94 billion pounds (107.7 billion euros) over two years the government measures put in place for purchasing power. According to the government, the economic picture will eventually be less dark than expected.

In response to the pressing demands of Britons who see inflation of more than 10% cutting into their purchasing power, the British government announced on Wednesday morning the extension for three months of the cap on energy prices for households, which would have had to increase on the first of April.

The Chancellor of the Exchequer – the title of the UK’s economics and finance minister – also unveiled that inflation is expected to come down “ 10.7 % in the last quarter of last year at 2.9 % by the end of 2023 “, again according to data from the OBR.

Among other measures to help households’ purchasing power, the Minister announced a 12-month extension of the fuel tax freeze.

The minister also promised to put an end to the higher energy tariffs paid by the more than 4 million households in the country, often modest, connected via prepaid meters.

No recession, promises the government

Jeremy Hunt, however, assured that the UK would not be in a technical recession this year, because the country does not meet the official condition: two consecutive quarters of decline in gross domestic product (GDP). The British economy is expected to contract by a total of 0.2% over the year due to a soft patch expected for the first quarter alone, before rebounding over the rest of the year, but also in the years which come, according to the forecasts of the OBR, a public forecasting body.

The British economy contradicts those who doubted it “, proclaimed emphatically the minister in Parliament. In November, we brought stability” and this time the government emphasizes ” on growth Mr. Hunt insisted.

The OBR had previously estimated in November that the economy would contract by 1.4% in 2023. In its last forecast in January, the International Monetary Fund (IMF) had anticipated that London would be the only major economy this year. in recession (with a projected decline of 0.6%).

Biggest strike day in years

The budget announcement took place in the midst of the most important day of action for several yearsaccording to British media, with walkouts of hundreds of thousands of people.

In London, the underground is at a standstill on Wednesday due to the conductors’ strike, the stations remained closed. Teachers are on strike in England and will continue their movement on Thursday. Tens of thousands of teachers demonstrated in central London in the middle of the day. THE hospital doctorswho started their action on Monday, did not return to their posts and joined the parade.

The 2% increase is a ” insult »

As Finance Minister Jeremy Hunt presented his budget to Parliament, civil servants demonstrated outside Downing Street, with drums and whistles. ” What do we want ? 10 % ! When do we want it ? NOW ! chanted the demonstrators, alluding to their demands for a 10% wage increase.

Jil Gant, a 59-year-old who works for the prison service, described as ” insult the 2% increase proposed by the government, she told AFP.

► Also to listen: United Kingdom: endless strikes?

Reform of childcare, hindrance to the career of ” a lot of women »

Jeremy Hunt highlighted a government effort to reform the childcare system, which he described as ” one of the most expensive in the world admitting that he often forced parents, especially women, to reconsider their career plans or even give up work. ” For many women, a career break means the end of a career “, noted the minister.

London will thus set up tax incentives to set up childcare structures and thus increase availability, and will also increase the hours of subsidized crèche for all children over nine months.

The inactivity rate in the UK, at 21.3% according to the latest figures available, remains higher than before the pandemic and is weighing on the economy, further adding to the difficulties in hiring European workers after the Brexit: in all, 1.1 million jobs are unfilled in the country.

Thousands of over-50s have chosen to take early retirement and a record number of Britons are being kept out of work by long-term illnesses, one of the consequences of the pandemic and underfunded public services health.

Opposition Labor leader Keir Starmer called it ” huge gift to the richest » tax reduction measures for private pension plans, intended to encourage older workers not to take early retirement.

► To read also: United Kingdom: faced with strikes and the crisis in the health system, Rishi Sunak wants to reassure