Financial watchdogs have said the spending plans of Chancellor Rishi Sunak are not as generous as they may appear.
After Mr Sunak was branded a spend-friendly Chancellor, the Institute for Fiscal Studies (IFS) said the situation is not as it seems.
IFS director Paul Johnson said: “The current spending plans are nothing like as generous as they appear.
“Average annual increases of 2.8% sound substantial; take account of the need to replace EU funding and factor in planned increases for health, schools, defence and overseas aid and there is relatively little here for other departments.
This complex chart tells a big story. Budget headline suggested day-to-day public service spending per person would return to 2010 level by 2024. Adjust to give true picture, and look at public services outside health, and spending per person will still be 19% below peak pic.twitter.com/XvsUW0Phg9— Paul Johnson (@PJTheEconomist) March 12, 2020
“If this spending envelope is stuck to, there are plenty of public services which will not be enjoying much in the way of spending increases over the next few years.”
Mr Johnson said the spending plans look “suspiciously front loaded” and could lead to increased taxes in future.
The IFS director also said the impact of coronavirus could hit the Budget plans hard.
On the economic forecasts, he said: “Projected growth rates averaging barely over 1.5% a year for the next five years are feeble, frankly.
“And they are indicative of an economy that is not in a robust position to deal with shocks like the coronavirus.”
Budget announcements imply very little for current public service spending outside "protected areas". Just Â£3bn for police, local govt, social care etc etc pic.twitter.com/GXxzxB8quQ— Paul Johnson (@PJTheEconomist) March 12, 2020
Mr Johnson branded the Budget an “odd affair”.
He said it was “really two budgets rolled into one”, adding: “There was the normal Budget setting out medium term tax and spending plans.
“And then there was the emergency Budget aimed at dealing with immediate potential consequences of the coronavirus.
“The latter made the former a rather odd affair.”