Fiscal performance

Our analysis so far of the Spring Forecast 2026.

A presentation on Scotland’s public finances given at the SNP’s 2025 party conference.

OBR productivity growth forecasts have historically been over-optimistic: a downgrade to the OBR's forecast could cause a real fiscal headache.

Debt interest spending is forecast to remain at twice the level it was prior to the pandemic.

Debt is forecast to stabilise by 2027-28, meeting the debt rule by a narrow margin of £15 billion.

In response to deteriorating global economic conditions, Rachel Reeves chose to fine-tune her spending plans to continue to meet her fiscal rules. 

There has not been a sizeable current budget surplus for over twenty years.

On average, the OBR has forecast a £23 billion current budget surplus 5 years out, but this has typically not materialised.

The OBR's October 2024 growth forecast underpinning the government’s fiscal plans is more optimistic than most.

Rachel Reeves gives herself so little room for manoeuvre that she creates costly uncertainty when the choice is obvious: raise taxes or cut spending 

The OBR forecast will underpin the Chancellor’s decisions at the next Spring Forecast.

Stronger growth this year and next is not expected to persist into the late 2020s.

The Chancellor is in a fiscal bind as low growth and high debt interest payments limit any room for manoeuvre in the forthcoming Autumn Statement.

In the current environment of high inflation and rising interest rates, tax cuts at the upcoming Budget would be extremely difficult to justify.