Hammond’s nemeses at the Institute for Fiscal Studies put the budget on the couch and find relief only in the demise of the autumn statementThe geeks fight back. Experts may have had a bit of a kicking over the last six months but it’s looking like they are going to have the last laugh. Or at least chuckle. Laughing may be a social skill too far for an economist.Having had a night to go through the chancellor’s autumn statement, the Institute for Fiscal studies, the UK’s leading independent economic thinktank, had convened in an airless basement – daylight and the IFS are not on speaking terms – off London’s Tottenham Court Road to deliver their verdict.Related: Chancellor's looser finance targets highlight weaker UK economyRelated: The British umpire: how the IFS became the most influential voice in the economic debate | Simon AkamRelated: Philip Hammond finds his safe space with Treasury select committee | John Crace Continue reading...

Rolling coverage of all the day’s political developments as they happen, including reaction to the autumn statement and the IFS press conference

All the day’s economic and financial news, as new GDP data shows that German exports fell in the last quarter

Thinktank says the poorest 10% have been unable to recover from financial crisis because of falling real wagesThe gap between the rich and poor remains at record levels, according to the Organisation for Economic Cooperation and Development as the poorest 10% have been unable to recover from the blow dealt by the financial crisis.The Paris-based thinktank said while the richest 10% had rapidly bounced back, long-term unemployment, low-quality jobs, and greater job insecurity had disproportionately hit low-income households.Related: World Bank renews drive against inequality Continue reading...

Respected thinktank says UK’s withdrawal from EU will stoke inflation and peg back wages to below their 2008 level in 2021Workers in Britain face the longest squeeze on their pay for 70 years as Brexit knocks wage growth and stokes inflation, a leading thinktank has said.Picking over Philip Hammond’s first autumn statement, the Institute for Fiscal Studies said that by 2021, real wages in the UK – pay adjusted for inflation – will still not have recovered to their 2008 level before the global financial crisis hit.Related: IFS says workers face 'dreadful' decade without real-terms increase in wages - Politics live Continue reading...

Free-market forces have helped create a health crisis – and governments must take action to stop subsidising junk foodIt is estimated that today’s obesity epidemic costs the global economy about $2tn (£1.6tn) or some 3% of GDP. For individuals, deciding what to eat is a jealously guarded privilege, but for economists obesity is not really about people exercising free-market choice. Instead it is a market failure.The causes of the epidemic are complex, spanning the social sciences to biology and technology. Consider, for example, the shift towards urbanisation and car transport. By reducing many people’s daily physical activity, these are estimated together to reduce individuals’ need for food by 300 calories a day. So how much less food should the car driver eat to compensate? About one biscuit less a day – a trivial change that only goes to illustrate that few of us really understand the energy needs of our bodies.

Personal loans and overdrafts fuelled increase in consumer borrowing in October, data from lenders reveals

What you need to know from the OBR’s latest forecasts, from the budget deficit to GDP growthA shortfall between government spending and income that reached £155bn in the aftermath of the banking crash was forecast in March this year to fall to £55.5bn in 2016-17. The Office for Budget Responsibility said its forecast was optimistic and it will now be £68bn.Related: Brexit will blow £59bn hole in public finances, admits HammondRelated: At a glance: autumn statement – 26 key points Continue reading...

Increase to 11.9% of people aged 16-24 follows years of decline and fans fears that Brexit uncertainty will weaken jobs marketThere has been a rise in the number of young people in the UK who are not in education, employment or training, known as Neets.Official figures show an increase in the number of 16- to 24-year-olds classed as economically inactive over July to September, lifting the number of Neets to 857,000. That was an increase of 14,000 from the previous three months and up 3,000 from a year earlier.14,000 rise in the numbers of #NEETs in July-Sept 2016, compared with previous 3 months https://t.co/1K0hFWezka Continue reading...

Six experts give their verdict on Phillip Hammond’s speech and the Office for Budget Responsibility’s new forecastsThe chancellor Philip Hammond has delivered his first major set-piece on the economy and public finances. Growth forecasts for 2017 and 2018 were revised down by the the independent Office for Budget Responsibility, while government borrowing was revised up.Six economists give their take on the autumn statement.This statement makes clear that the big theme of economic policy under Hammond will be improving productivity. He wants to send a powerful signal that the UK is open for business and that the government has a plan to grow the economy through this parliament.

Thinktank says low-paid will be hardest hit in next five years as inflation and welfare cuts compound slow earnings growthFamilies face a worse squeeze on their living standards over the next five years than they suffered in the wake of the financial crisis, as Brexit slows the economy and Conservative welfare cuts bite, according to a new report.Analysis of Wednesday’s autumn statement by the Resolution Foundation thinktank suggests average earnings are set to grow only half as rapidly as in the austerity years after the economic crisis. At the same time, living standards will be undermined by higher inflation and ongoing welfare cuts. Continue reading...

City analysts say Philip Hammond’s measures are sensible as Britain faces challenging years of Brexit negotiationsThere was a veneer of discipline in the chancellor’s handling of the UK’s public finances, after he ditched his predecessor’s strict target of balancing the budget in 2020 with three looser targets to be met in the next parliament.Philip Hammond opted to set a cap on welfare spending, but only applied the new rule from the 2021/22 financial year. He also said the government’s new aim was to bring down debt as a proportion of GDP by 2021, which George Osborne had hoped would happen under his watch.Related: Move over Jams, next year this time the focus may be on PGPsRelated: The Guardian view on the autumn statement: half right, half wrong | Editorial Continue reading...

In the 2016 autumn statement the cities of the north have lost out, and all the spoils have gone to London and the south-east – againThe chancellor, Philip Hammond, is Theresa May’s chauffeur. It must be a ghastly job. He has to drive the economy towards Brexit, with no instructions, no map and no clear road ahead. Meanwhile, he has three blind mice in the back seat: David Davis, minister for I-haven’t-a-clue, Liam Fox, minister for what-on-earth-is-happening, and Boris Johnson, minister for Oh-Christ!Related: Autumn statement: OBR says Brexit impact could be even worse than feared - liveRelated: At a glance: autumn statement – 26 key points Continue reading...

This year’s shopping sales extravaganza is likely to have a feel of going, going, gone, with many items set to get more expensiveAs the clock ticks down to Black Friday, aggressive promotions on everything from 4K TVs to tablet computers and winter coats could be the last hurrah for shoppers before price hikes in 2017.After bargain-hunting consumers went on the rampage on Black Friday in 2014, fighting in the aisles for cut-price widescreen televisions, last year it was a much tamer affair, as shoppers retreated to the safety of seeking the best bargains online.Related: Black Friday: a shopper’s guideRelated: Black Friday warning as report finds only half of offers are the real deal Continue reading...

Rolling coverage and analysis as chancellor Philip Hammond announces£122bn of extra borrowing and new spending plans

Chancellor attempts to strike cautiously upbeat tone but OBR warns of extra borrowing over next five yearsPhilip Hammond conceded that Brexit will blow a £59bn black hole in the public finances over the next five years, as he outlined plans to boost investment in infrastructure and housing to equip the UK economy for life outside the EU.In his first fiscal statement, the chancellor, who had supported remain, sought to strike a cautiously upbeat tone about the country’s prospects, saying the economy had “confounded commentators at home and abroad with its strength and its resilience” since the referendum result last June.Related: At a glance: autumn statement – 26 key pointsRelated: The Guardian view on the autumn statement: half right, half wrong | Editorial Continue reading...

Gloomy UK economy forecast for 2017 may compel the chancellor to provide for ‘poor getting poorer’ alongside the ‘just about managing’The new chancellor could barely have hoped for a better backdrop. High street spending is booming, inflation remains low, unemployment is the lowest it’s been for more than a decade. And all that despite the shock referendum result and warnings from people like Bank of England governor Mark Carney and the International Monetary Fund that a vote to leave could spark recession.But it would be a very unwise chancellor who said Britain had escaped this vote unscathed. Brexit negotiations have not even started and in crucial areas such as business investment very little data is available at this point to reveal quite how much the referendum upheaval has knocked the economy off course. Continue reading...

A dysfunctional economy meant the chancellor, Philip Hammond, largely dispensed with political theatrePhilip Hammond’s first and last autumn statement was a sombre affair. The chancellor largely dispensed with political theatre to tell it straight. Britain’s economy is dysfunctional. Austerity has failed. Welfare cuts are going to bite. Brexit will be a £60bn drag on growth and the public finances. That’s the way it is.Related: Chancellor to crack down on letting fees in autumn statementRelated: 'No evidence' Jane Austen ever went to stately home mentioned in autumn statement Continue reading...

Details are scant and spending is spread over five years, with uncertainty over what government wants to buildDo not run away with the idea that the chancellor has borrowed the clothes of Donald Trump and ordered an infrastructure splurge. Ploughing £23bn into a new national productivity investment fund sounds impressive until you remember that the HS2 high-speed railway, funded separately, is due to cost £56bn at the last count.Remember, too, that the £23bn will be spent over five years, so an average of £4.6bn a year. And note that the spending is weighted towards the later years; in the first year, 2017-18, the figure is just £2.4bn.Related: Philip Hammond admits Brexit vote means £122bn extra borrowing Continue reading...

Forecaster says weak business investment and rising inflation will affect economy but Britain will dodge recessionWeaker business spending and a squeeze on consumers from higher inflation will dent the UK economy next year, but warnings for a post-referendum recession should prove unfounded, according to the government’s independent forecasters.The Office for Budget Responsibility was forced to revise down its prediction made before the Brexit vote that GDP would rise 2.2% next year. It now sees the economy expanding by only 1.4% and warns there will be a knock-on effect on the public finances.

Philip Hammond’s funereal demeanour suited a man with few rabbits in his hatThe chancellor brings the air of an undertaker to the despatch box. His suits are dark, his expression glum and his sense of humour, although unexpectedly sharp, is deployed only sparingly. This is a chancellor for hard times, and in his unshowy way, hard times are what he predicted.This chancellor is the antithesis of his predecessor George Osborne and so was his autumn statement. The only rabbit pulled from Philip Hammond’s topper was that the number of opportunities for rabbit pulling – what the Treasury calls fiscal events – is to be cut from two to one. This was Hammond’s first autumn statement, and it is to be his last.Related: Philip Hammond admits Brexit vote means £122bn extra borrowingRelated: Autumn statement: brill for builders, perturbing for pensionersRelated: Hammond warned against Brexit and no one listened. Now it's payback Continue reading...

Philip Hammond’s autumn statement nod to Britain’s ‘central long-term’ challenge echoes Gordon Brown’s words 19 years ago“The first challenge is to increase our productivity. Britain today is some 20% less productive than our main competitors and has been for years.”Not the words of Philip Hammond in his autumn statement but those of Gordon Brown in his pre-Budget report 19 years ago.Related: Philip Hammond admits Brexit vote means £122bn extra borrowing Continue reading...

Trade and Brexit departments and Foreign Office to receive funds amid criticism that Whitehall is understaffed and ‘cannot cope’Philip Hammond has set aside up to £412m of additional funding to help Whitehall deal with leaving the European Union following criticisms that the civil service cannot cope with Brexit.The chancellor’s autumn statement said that the Department for Exiting the EU, or Dexeu, will receive £51m this financial year and an extra £94m from 2017/2018 until the UK’s exit is complete.Related: Autumn statement: OBR says Brexit impact could be even worse than feared - liveRelated: Philip Hammond admits Brexit vote means £122bn extra borrowing Continue reading...

Investment fund of £23bn announced in autumn statement must be quickly translated into action, CBI head saysBusiness leaders have told the government it must convert a new £23bn productivity investment fund into “tarmac, tracks and telecoms” rapidly if it wants to boost Britain’s lagging productivity and economic growth.The private sector has become increasingly frustrated at a string of unfulfilled pledges by the government – primarily by the former chancellor George Osborne – to step up investment in British infrastructure.Related: Austerity, Brexit and 'Jams': readers react to the autumn statementRelated: Philip Hammond's autumn statement is a welcome reality check Continue reading...

New chancellor faces up to the UK’s deep-seated economic weaknesses now left exposed by the Brexit votePhilip Hammond’s message was stark and clear. The result of the EU referendum in June means the economy has arrived at a reality checkpoint. Deep-seated weaknesses will be exposed as the government negotiates a Brexit divorce between now and 2019.The chancellor was candid about Britain’s woefully poor productivity record. He admitted that infrastructure was deficient. There was no attempt to disguise the fact that there is a prosperity gap between London and other major cities.Related: At a glance: autumn statement – 26 key pointsRelated: Autumn statement: OBR says Brexit impact could be even worse than feared - live Continue reading...

Philip Hammond gives his autumn statement in the House of Commons on Wednesday. Key points include lower growth forecasts, a £23bn national productivity investment fund, a housing white paper and the abolition of letting fees for tenants. The chancellor also said this would be his last autumn statement

Labour describes long-term economic plan as an abject failure after chancellor uses autumn statement to defer the balancing of the booksPhilip Hammond has admitted that the Brexit vote’s blow to the economy would force the government to borrow £122bn more than hoped as he pushed back government plans to balance the books in his autumn statement.In the government’s first major economic announcement since the vote in June to leave the EU, the new chancellor said the economy was faring well in the wake of the referendum result but growth would slow markedly next year on the back of weaker business spending and a squeeze on household budgets from rising living costs.Related: Key points of the autumn statement – at a glanceRelated: Autumn Statement 2016: Hammond unveils £122bn Brexit black hole - live Continue reading...

The chancellor, Philip Hammond, tells the House of Commons on Wednesday that he will be abolishing the autumn statement. MPs laughed at this announcement because they expect two budgets next year. Gordon Brown introduced the autumn statement in its 21st century form

Our writers give their reaction to chancellor Philip Hammond’s first autumn statementRelated: Autumn Statement 2016: Hammond unveils £122bn Brexit black hole - liveRelated: Philip Hammond admits Brexit vote means £122bn extra borrowingRelated: Key points of the autumn statement – at a glance Continue reading...

Philip Hammond has delivered his first autumn statement as chancellor. These are the key points, with political analysis

The failure to get to grips with our crises, by all mainstream political parties, is likely to lead to a war between the major powers in my lifetimeWave the magic wand and the problem goes away. Those pesky pollution laws, carbon caps and clean-power plans: swish them away and the golden age of blue-collar employment will return. This is Donald Trump’s promise, in his video message on Monday, in which the US president-elect claimed that unleashing coal and fracking would create “many millions of high-paid jobs”. He will tear down everything to make it come true.But it won’t come true. Even if we ripped the world to pieces in the search for full employment, leaving no mountain unturned, we would not find it. Instead, we would merely jeopardise the prosperity – and the lives – of people everywhere. However slavishly governments grovel to corporate Luddism, they will not bring the smog economy back.Related: 'Extraordinarily hot' Arctic temperatures alarm scientistsEven if we ripped the world apart in the search for full employment, leaving no mountain unturned, we wouldn't find it Continue reading...

As the graphs and charts point out, Phillip Hammond does not have much scope for giveawaysThe UK chancellor, Philip Hammond, will deliver his maiden autumn statement against a backdrop of weaker growth prospects, rising inflation and a large deficit.Scope for headline giveaways will be limited but Hammond is likely to signalmeasures to help so-called Jams – those families who are “just about managing”. Here are five key charts to consider before he stands up. Continue reading...

The chancellor unveils his choicest jams for the Jams, but they will be dwarfed by his giant cutsOn any other day, the raft of measures announced by Philip Hammond just after midnight would not be a mere teaser for this afternoon’s autumn statement: they would be the main event itself. A ban on letting-agent fees; an above-inflation jump in the minimum wage; an extra billion for new homes; more cash for families claiming universal credit: any one of these policies would be natural fodder for the front page. Yet here they are all bundled together on one Treasury press release with a few more stocking-fillers for good measure. These follow briefings about an extra billion for new roads, more money for research and development and the latest attempt to roll out superfast broadband. One may wonder how Mr Hammond plans to surprise MPs this afternoon, beyond the revelation of an even bigger black hole in the public finances – caused by Britain leaving the EU, the economy growing slower and tax receipts plummeting. But those aren’t the sort of headlines any chancellor would relish.Nevertheless, this is an exceptional flow of news, especially considering that it comes from a chancellor who claims to dislike big autumn statements. So much for the new politics. In 1947, then-chancellor Hugh Dalton was heading into the chamber to deliver his budget when he blurted out details to an evening paper reporter, on the assumption (it is often said) that it was too late to go to press. The list – “No more on tobacco; a penny on beer; something on dogs and pools but not on horses” and so on – was being sold on the streets 20 minutes before Mr Dalton stood up to speak. Thus did Clement Attlee lose his chancellor. What was once a resigning matter is now considered news management. Continue reading...

What Philip Hammond’s speech is likely to mean for the economy, personal finance, business and moreGDP Economic growth is slowing. A 2% forecast for next year is expected to be revised down to nearer 1%.Related: Philip Hammond: a cautious, unflashy and quietly confident chancellor Continue reading...

How is “helping low-income families to save” a measure to help the “just about managing” (Hammond told to help families ‘just managing’, 18 November)? On a low income you don’t have money to save. With low savings rates, saving doesn’t confer much benefit. On a modestly good income when I was young, it was very difficult to save the amount recommended for my pension.Our politicians should have experience of the real world. Maybe we should raise the age to become an MP and insist on demonstrating experience of working in a public sector. Going from a privileged background, studying politics and then entering parliament is not a recipe for a fairer society and understanding the problems of the disadvantaged. Continue reading...

The problem as you correctly identify in your editorial (22 November) is that the employee-director argument goes to the heart of what and whom a company is run for. Getting the right sort of answer to that is vital to knowing how best to reform corporate governance. As you remind us, Lord Bullock in his report in the 1970s concluded that viewing a company as the exclusive property of shareholders is out of touch with the company as a complex social and economic entity. Nearly half a century on and we are still unable to face the implications of this argument.Britain is one of the only remaining large nations in Europe that has failed to recognise the importance of reforming corporate governance. But that needs more than a decision to appoint employee-directors. Little will change within the unitary or single board structures dominant in Anglo-American jurisdictions. The changes can only be realised within a structure of independent supervisory boards, supported by enforceable directors’ duties. Continue reading...

British government unlikely to hit this year’s deficit target despite cutting October’s borrowing by 25% to £4.8bn

How has the economy reacted to the vote to leave the EU on 23 June? Each month we look at key indicators to see what effect the Brexit process has on growth, prosperity and trade in the UK Continue reading...

Latest monthly Guardian analysis of data points to post-referendum economy holding up well. But will it last for 2017?• Help fund our journalism by becoming a Guardian supporterThe chancellor, Philip Hammond, has been given a boost ahead of his maiden autumn statement by a Guardian analysis showing the economy continues to confound gloomy forecasts for a post-referendum slump.

Two ex-members of the Bank of England interest rate-setting committee discuss what lies in store after the EU referendumDavid Blanchflower, professor of economics at Dartmouth College, New Hampshire, and former member of the Bank of England’s monetary policy committee (MPC) from June 2006 to May 2009The UK economy is slowing, there is no doubt about it. The incoming data so far though are mixed as it is early days post the Brexit vote. The PMIs were quite strong, suggesting GDP growth isn’t set to slow sharply in the fourth quarter of 2016 but 2017 is likely a different matter. Retail sales were also pretty good. Despite the boost from the fall in sterling, Britain’s trade deficit with the rest of the world widened unexpectedly in September. Inflation surprised to the downside but major price rises look to be in the pipeline as factory gate prices increased 0.6% in October compared with an increase of 0.3% in September.Related: The Brexit economy: remarkable resilience as spectre of inflation looms Continue reading...

He oversaw the Iraq war and calamitous financial deregulation, and did lucrative work for foreign tyrants. No wonder faith in the centre-left has evaporatedIf Tony Blair is the answer, then the question is high on illicit substances. He is reported to be launching an organisation to examine why the “centre left” has been overwhelmed by the forces of populism. It’s as though he’s a spectator, a passive commentator, a bystander, rather than a leading contributor to this age of political calamity. Someone who should be in the dock is electing himself chief prosecutor.Just consider this. In July, Tony Blair was damned by an official inquiry for his role in a war that cost the lives of hundreds of thousands of human beings, including 179 British service personnel, and which contributed to the rise of fanatical Islamist terrorism. That’s before we even mention Blair’s lucrative service for foreign tyrants. If normal rules applied to men of power, he would retire from active political life in disgrace. And yet, less than five months later, here he is, plotting a return to the frontline of politics. His career is like the T-1000 at the end of Terminator 2: it just will not die. If Blair wants material for his vanity project – “why are people so disillusioned with establishment politics?” – then how about starting with politicians who face no penalties for their colossal misdeeds, and continue to exert huge power and influence without any apparent shame or even penitence?Even before the Chilcot report was published, polls showed that more than half the population would never forgive himRelated: Tony Blair aims to fight resurgent populism with centre-ground campaign Continue reading...

CBI says fall in sterling since Brexit vote is pushing up cost of materials, with factory gate prices rising at fastest for two yearsBritain’s factories are poised to raise both output and prices over the coming months as they continue to adjust to the impact of the EU referendum in June.The latest snapshot of the economy from the Confederation of British Industry (CBI) showed that order books for UK manufacturers are strong and production is expected to rise at its fastest pace in almost two years over the next three months. Continue reading...

Rises in NI, corporation tax and stamp duty on shares help swell Treasury coffers but Philip Hammond will still miss deficit targetBritain’s public finances improved in October with a fall in the monthly deficit to £4.8bn from £6.4bn in the same month last year, giving the chancellor a lift ahead of Wednesday’s autumn statement.Healthy increases in national insurance contributions, corporation tax and stamp duty on shares helped boost government coffers and put Philip Hammond in a better position to ease austerity.

AO World boss warns post-Brexit vote price increases are inevitable given sterling’s weakness with consumers feeling the full impact in JanuaryThis year’s Black Friday will be the biggest yet as shoppers snap up large items such as fridges before Brexit-induced price rises take effect in January, the boss of AO World has predicted.John Roberts, the online retailer’s chief executive, said price rises were inevitable after the pound’s plunge against other major currencies since the EU referendum. Suppliers were starting to charge more and shoppers would feel the full impact by the end of January, he said.Related: Black Friday warning as report finds only half of offers are the real deal Continue reading...

To those with average and low incomes, his simple slogan ‘make America great again’ sounded like ‘make you great again’The US president-elect, Donald Trump, campaigned in part on a proposal to cut taxes dramatically for those with high incomes, a group whose members often have elite educations as well. And yet his most enthusiastic support tended to come from those with average and stagnating incomes and low levels of education. What gives?Trump’s victory clearly appears to stem from a sense of economic powerlessness, or a fear of losing power, among his supporters. To them, his simple slogan, “make America great again,” sounds like “make you great again”. Economic power will be given to the multitudes, without taking anything away from the already successful.Related: Does Trump’s election spell globalisation's end?Related: Trumpism could be a solution to the crisis of neoliberalism Continue reading...

Oxfam criticises rising inequality as Credit Suisse finds about 400,000 Britons have lost their status as dollar millionairesThe UK saw $1.5tn (£1.2tn) wiped off its wealth during 2016 after the Brexit vote sent the pound tumbling and the stock market into reverse, according to a survey by Credit Suisse.A fall in values at the top-end of the property market also contributed to about 400,000 Britons losing their status as dollar millionaires and one of the biggest drops in wealth among the major economies.Related: RBS chairman calls on Theresa May to draw up Brexit transitional plan Continue reading...

Once it was the prosperous first industrial town in Wales. Today one in three families can’t cope at all. This is the ‘post-industrial’ truth of modern BritainA health worker in Pontypool told me what happens when people lose their sense of purpose. “You don’t get up in the morning. You might see a spiral in depression,” she said last week. “You lose contact with the outside world.” The dismal list went on: no self-worth, no self-confidence ...Related: Burning anger in the land of Nye Bevan: why a Labour heartland is backing BrexitThe reason the political geography of Britain is so divided is because its economic geography is so unequalRelated: Britain's shrinking economy: why the level of debate is farcical | Aditya Chakrabortty Continue reading...

The ideology driving some Tory MPs to support a hard Brexit would be a disaster for working people.Falling back on World Trade Organisation rules would not be a clean break but the most destructive, harshest of settlements, which would lead to fewer jobs and less business investment, and would leave the British people poorer. This is not what they voted for in June. Continue reading...