The U.K.’s annual budget announcement will be delayed after the new Prime Minister Rishi Sunak took office Monday.
Hannah Mckay | Reuters
LONDON — The U.K.’s fiscal statement will be delayed to Nov. 17 after it was initially brought forward to Oct. 31.
The budget will contain the country’s medium-term fiscal plan to “cut public spending on a sustainable footing, get debt falling & restore stability,” according to a statement by the HM Treasury.
The government’s fiscal statement will be accompanied by an independent forecast from the Office for Budget Responsibility, unlike the so-called mini-budget that sent markets into turmoil on Sept. 23.
Finance Minister Jeremy Hunt said he and the newly-appointed Prime Minister Rishi Sunak had decided it would be “prudent” to postpone the fiscal announcement, which has now been upgraded to a full fall statement.
“Our number one priority is economic stability and restoring confidence that the United Kingdom is a country that pays its way,” Hunt told Sky News Wednesday.
While details of the budget are yet to be disclosed, Sunak confirmed that tackling inflation will be a focus as he faced questions from fellow lawmakers for the first time.
“Inflation is the enemy that makes everyone poorer,” Sunak said in the House of Commons on Wednesday.
U.K. inflation moved back up to a 40-year high of 10.1% in September, according to estimates by the Office for National Statistics.
Sunak brings back fracking ban
On a busy first full day as prime minister, Sunak also committed to banning fracking, reversing a decision made by his predecessor, Liz Truss.
Speaking in Parliament on Wednesday, Sunak said he stood by the Conservative Party’s 2019 manifesto pledge on fracking, which said the party would “not support fracking unless the science shows categorically that it can be done safely.”
When a reporter asked a spokesperson for Sunak if that meant fracking was “back in the bin,” they said “that’s correct,” according to Reuters.
Sterling rose to a six-week high as Sunak met with his cabinet for the first time Wednesday morning and amid speculation the budget statement could be delayed.
The pound was last seen up 0.8% against the dollar at around $1.156.
Sunak became prime minister on Tuesday – Britain’s third in 50 days – following Truss’ resignation after her financial policies flopped and triggered market mayhem.
The change in prime minister followed a fast-tracked Conservative Party leadership election. The ruling party is battling to stabilize the economy and win back public confidence after seeing a slide in opinion polls and plummeting approval ratings.
Foreign Minister James Cleverly suggested on Wednesday morning that the budget announcement could be delayed.
Cleverly told the BBC that Sunak would work with Finance Minister Jeremy Hunt to “get it right,” and that Hunt wanted to ensure the financial statement “matches his priorities.”