Philip Hammond has taken a “gamble” on the future health of the public finances by using better short-term borrowing figures to raise spending on the NHS, according to Britain’s leading tax and spending thintank.
The Institute for Fiscal Studies warned that the public finances could deteriorate next year, at a time when Britain leaves the EU, which could pose difficult questions for the government after the chancellor increased spending on the health service.
It said there was possibly a one in three chance that the public finances would deteriorate significantly next year, adding that the judgment to increase spending could push the national debt higher.
Paul Johnson, the director of the IFS, said: “When push comes to shove it’s not tax rises and it’s not the NHS that Mr Hammond is willing to gamble on, it’s the public finances.”
He added that it was “for the birds” that the government would be able to eliminate the budget deficit by the mid-2020s, while adding: “One might question the chancellor’s claim to be take a ‘balanced’ approach.”
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