Spending and stability: How much fiscal space does the UK have?

Article

After devastating turmoil in markets following the government’s mini budget, the key question for the government right now is what its fiscal policy stance should be.

This briefing outlines the current macroeconomic situation and disentangles the binding constraints on fiscal policy in the short term and the medium term.

We challenge the notion that spending cuts are somehow inevitable for restoring macroeconomic stability. We set out an approach that would both stabilise the economy and ensure that public services are on a secure footing.

Related items

  1. View of Bank of England, Royal Exchange, and Duke of Wellington equestrian statue (1844) with skyscrapers and construction in background.

    Navigating in the fog: Why the OBR should hold its nerve on the productivity forecast

    The fiscal watchdog is under pressure to downgrade its forecast, costing the chancellor billions – but this would be premature.
  2. A busy bus full of people of all ages. An older couple smile at a younger woman with a baby in a pushchair

    Everyday concerns: What people want from transport

    Transport has a key role to play in achieving the UK government's missions and improving lives. 
  3. An unrecognisable woman playing a slot machine in a social club

    Reforming gambling taxation: How to lift half a million children out of poverty

    A key priority for the government’s upcoming child poverty strategy should be to remove the two-child limit and scrap the household benefit cap.