Sunak warns of huge strains on public finances
Britain’s public finances will face enormous strains in the wake of the third national lockdown, Chancellor Rishi Sunak has warned.
Sunak is under pressure to continue the emergency support packages to prevent waves of job losses and business closures, but has said he plans to “level with people” during his budget on Wednesday.
The government is bracing for the possibility of a rebellion from Tory MPS over any tax rises, with backbenchers being warned they could be kicked out of the parliamentary party if they vote against the budget.
Sunak issued a warning about the scale of the damage caused by the pandemic, suggesting he could use the budget to begin making hard decisions to repair public finances.
He said there are “enormous strains” and the UK is “exposed” if the current low interest rates go up. For example, a rise of 1% will cost £25 billion a year to service the debt
in the wake of vast spending to shore up the economy.
“We went big, we went early, but there is more to come and there will be more to come in the budget. But there is a challenge and I want to level with people about the challenge,” Sunak said.
Ahead of his set-piece speech, the Chancellor has announced a series of policies including a £5 billion grant scheme for pubs, restaurants, shops and other businesses hit hardest by the coronavirus pandemic.
The money is targeted at England, but the devolved nations in Scotland, Wales and Northern Ireland will receive an extra £794 million in funding through the Barnett formula.
Staff at the Coulport and Faslane naval bases on the Clyde are to strike over pay.
Members of trade union Unite voted to begin rolling industrial action from March 12.
Babcock Marine industrial staff – including electricians, mechanical fitters, plumbers and joiners – rejected a pay offer of 1.1%.
Non-industrial staff – engineers, supervisors, managers, and administrative staff
– agreed a pay deal.
Babcock Marine said it will continue to deliver on its commitments to customers, despite the industrial action.
Stephen Deans, Unite regional coordinating officer, said: “Unless Babcock Marine management get back round the negotiating table and start to behave responsibly, then a wave of industrial action is set to strike the bases from the middle of March. This is at a time when contracts worth up to £200 million will be decided upon.
“This situation is not irretrievable or inevitable, but a change is solely dependent upon the company meaningfully engaging with Unite.”
Babcock Marine said: “We are disappointed that our Unite trade union members at HMNB Clyde have chosen to vote for industrial action.”