EQ Weekly Roundup 14-3-18

This week’s roundup includes news that the Chancellor has upgraded the UK’s growth forecast, the UK’s expected divorce bill has been increased in forecasts and record numbers of people have recently switched energy provider.

This week’s roundup includes news that the Chancellor has upgraded the UK’s growth forecast, the UK’s expected divorce bill has been increased in forecasts and record numbers of people have recently switched energy provider.

Spring Statement: UK growth revised upwards

The UK economy is growing at a slightly faster rate than predicted in November and borrowing is lower, Chancellor Philip Hammond has said in his Spring Statement this week.

Growth will be 1.4% this year, 0.1% higher than forecast, with the forecast for 2019 and 2020 unchanged at 1.3%.

The chancellor said borrowing was due to fall in every year of the forecast and told the House of Commons debt will fall as a share of GDP from 2018-19.

He added there was ‘light at the end of the tunnel’ for the UK economy.

But Labour’s shadow chancellor John McDonnell accused him of ‘astounding complacency’ by failing to address the ‘crisis on a scale we have never seen before’ in the UK’s public services.

Brexit divorce bill to hit £37.1bn

The financial settlement for the UK to leave the EU will reach £37.1bn, according to the Office for Budget Responsibility.

This figure is based on the ‘phase 1’ agreement which the UK agreed with member states last December and is contained in an Appendix to the OBR’s latest forecasts.

Almost half this bill relates to Britain’s commitments under the current EU budget (the Multiannual Financial Framework or MFF) that ends in December 2020.

Around half is due to meeting Britain’s share of outstanding payments at the end of the current MFF (known as the ‘reste à liquider’ or RAL).

The remaining small fraction reflects pension liabilities less assets returned to the UK, the OBR says.

Record numbers switch energy provider

More than 660,000 customers switched their electricity supplier in February – the highest number yet – according to Energy UK.

The figures show a 60% rise on February 2017, and that over a million customers had switched so far this year.

Energy UK said one reason may have been the cold weather during the month. The most recent figures from regulator Ofgem show high numbers of households also switching their gas supplier.

Last year, 4.1 million domestic customers chose a new gas provider, the highest since 2008. Gas bills are usually higher than electricity bills, so there is a greater incentive to change supplier.

Millennial railcard to launch

A nationwide trial of the so-called millennial railcard has launched this week, but card numbers are limited.

The one-year railcard for 26 to 30-year-olds costs £30 and offers a third off most fares in England, Wales and Scotland.

Only 10,000 will be released – enough for one in 500 of the eligible population – and the cost of some peak time travel will not be reduced.

The nationwide launch follows a trial across the Greater Anglia network. Another 10,000 railcards were sold during that trial. The new discount card was announced in Chancellor Philip Hammond’s Budget in November, but received a mixed response from its target audience.