He’s Eeyore no more! Upbeat Hammond to unveil a Brexit boost

BRITAIN’S economy is set to confound the sceptics as the country leaves the EU, Philip Hammond will declare today.

The Chancellor will cast aside his reputation as the Cabinet’s Eeyore figure to unveil upgraded forecasts in his spring statement, according to Whitehall sources last night

The Chancellor would be ‘markedly optimistic about the outlook’ ahead of Brexit next year, said one. Mr Hammond is expected to give only a brief 15-minute update to Parliament on the economy and public finances today as the Budget has been moved to the end of the year.

The passionate Remain campaigner has refused to say in recent days if leaving the bloc will be ‘worth it’. But he is said to have been struck by the resilience of the UK economy since the EU referendum.

Last November, a hole was knocked in Mr Hammond’s plans when the Office for Budget Responsibility slashed its predictions for growth.

But the OBR is set to upgrade its forecasts today with public borrowing expected to be sharply down and tax revenues up.

The Chancellor will also confirm that day-to-day government spending is in the black for the first time since the 2008 financial crisis.

However, he will warn there can be no easing up on spending cuts while Britain is saddled with a national debt approaching £2trillion.

Nick Timothy, Theresa May’s former joint chief of staff, has urged the Chancellor to announce the ‘end of austerity’. But Nicky Morgan, chairman of the Commons Treasury committee, said this would be premature.

On the Conservative Home website yesterday, she wrote: ‘If we relax too much then we undermine our criticism of the last Labour Government for not “fixing the roof while the sun shines”.’

Although Mr Hammond will not be making tax or spending announcements, he is set to reveal consultations with far-reaching effects.

These include a review to consider if single-use plastics and chewing gum should be taxed while the long-term impact of an ageing society will be examined. Tory MPs also want more cash for defence and the Chancellor has acknowledged ‘pressures’ in this area.

He will, however, risk reopening a row about the treatment of small business when he confirms plans to review VAT rules. Last year, he axed a bid to slash the threshold from £85,000 to £25,000 after a backlash from Tory MPs.

But the Chancellor will ask officials to look at tapering the need to register VAT to avoid an immediate bill of £17,000 for firms going through the £85,000 barrier.