Jeremy Hunt’s 2023 budget: five things to look out for

theguardian.com:

If it’s headlines he’s after, Jeremy Hunt has a tough act to follow when he delivers his budget on 15 March. It would be quite something for the chancellor to make as big a splash as his predecessor Kwasi Kwarteng did with his package of measures last September.

Hunt will not mind having a lower profile. If the budget makes a few ripples rather than sending a tsunami through the financial markets – as Kwarteng’s tax cuts did – then so much the better. Anybody expecting a giveaway package next week is certain to be disappointed.

The markets have calmed down after Liz Truss’s ill-fated and brief premiership, but the strikes planned for budget day involving transport, health, education and the civil service tell their own story. Britain’s cost of living crisis is making people poorer and angrier.

As a result, Hunt has some difficult choices to make. Here are five things to look out for.

The short-term prospects for growth and the public finances have improved since Hunt delivered his autumn statement in November. Britain appears to have escaped a recession in the second half of 2022 by a whisker, consumer spending has held up better than expected despite the cost of living squeeze, and business surveys have picked up. The Office for Budget Responsibility is expected to announce that the UK will have a shorter and shallower downturn than it was pencilling in last November and will reduce its estimate of government borrowing this year. On some estimates, Hunt will have an extra £30bn at his disposal. The Treasury says stronger growth now means slower growth later and that it can’t rely on the good news on borrowing persisting.

Business is about to be hit by a double whammy because from April the generous regime to encourage