Why are UK borrowing costs so high when our debt and deficit numbers look better than others? In a @ippr.org paper, @carsjung.bsky.social and I argue the problem is less “fundamentals” and more a bad equilibrium of market vibes: www.ippr.org/articles/rul.... Short thread. 🧵

Overall thought on the budget: doomster narratives turned out to be overblown and Rachel Reeves was able to raise the money for a range of welcome measures through a sensible combination of freezing income tax thresholds and taxing those who could most afford it. /1

Delighted to see the abolition of the two-child limit for means-tested benefits. We should never punish children for the so-called 'sins' of their parents. Children turning up at school too hungry to learn is no way to build a country fit for the future

Useful background to the gambling tax increase here:

Delighted to see the Chancellor has taken forward the recommendation from Gordon Brown, @smfthinktank.bsky.social and @ippr.org to increase taxes on gambling. We called for this hugely profitable industry to contribute to ending the two child limit for benefits

Lots of performative doom about the UK economy going on. Here a useful reality check fromthe @economist.com. Cheer up a bit everybody! Eg this year "the FTSE has returned 23% against the S&P’s 12%". www.economist.com/finance-and-...

Reducing inactivity levels by helping more people with health conditions/disabilities to stay in work would improve the lives of many people. But it is simply inaccurate of Charlie Mayfield to say that inactivity levels are a 'crisis' as they are currently lower than at any point before Nov 2018. 🧵

Reducing inactivity levels by helping more people with health conditions/disabilities to stay in work would improve the lives of many people. But it is simply inaccurate of Charlie Mayfield to say that inactivity levels are a 'crisis' as they are currently lower than at any point before Nov 2018. 🧵

*Have new WCA claims exploded in the last year?* My new blog post on (another) mess in DWP statistics... inequalities.substack.com/p/have-new-w...

The Bank of England held rates today. A close call—we think the Bank could have gone further and cut. Inflation should fall, the labour market is cooling, growth is sluggish, and the Budget is likely to remove demand. Some less-noticed nuggets👇#BoE #UKeconomy

💰 Are tax rises inevitable? It all depends on the OBR forecast, says @ashwin-kumar.bsky.social. A lot of the current speculation is premature, and based on the most negative possible outlook.

✍️ New article: “$3 a day: A new poverty line has shifted the World Bank’s data on extreme poverty. What changed, and why?” 🧵

Today's interest rate cut by the Bank of England is welcome but comes too late - the Bank has kept rates too high for too long, while essential costs remain high and households continue to struggle. Immediate government action is needed to address cost of living www.ippr.org/media-office...

Quite a big deal that the BoE has revised productivity up. --> Risks have diminished as new analysis shows "potential productivity is now more explicable by [past] shocks", and Bank staff judge "some of the weakness in the headline data has been overstated". Lowers pressure on the OBR to downgrade.

It's actually quite mad how poorly taxed gambling is. Great proposal by IPPR colleagues on how to fix this, and how the proceeds could be used to tackle child poverty.

Today's stories saying the unemployment rate has risen from 4.6 to 4.7% tell only part of the story. The same data - the Labour Force Survey - shows this rise comes from more people who were inactive starting to look for work and so being classified as unemployed, which is good news 🧵 /1

Today inflation figures mean that food costs are up 36% over the last four years. It's people on the lowest incomes who will feel this hardest as food occupies much a higher proportion of their weekly budget. www.bbc.co.uk/news/article...

If anyone has watched the Netflix documentary on Grenfell and is looking for further reading, I've made all my posts summarising the inquiry report free to read. Links in the thread below (on the bad site) x.com/PeteApps/sta...

This is a really good and important report. Some thoughts of my own...

👏 In rare, but welcome, good news from ONS, they are now using industry scanning data to measure grocery price inflation… 🛒 We should see much more accurate, reliable and granular grocery inflation numbers going forward, and about time too! www.ons.gov.uk/economy/infl...

❤️‍🩹 | NEW REPORT: Voters want bold action on health – and don’t see it as 'nanny statism'. Our new research with Public First shows that smarter public health policy isn’t just good for the nation – it could be a vote-winner too. www.ippr.org/articles/the...

Liverpool falls silent to remember the 97 football fans who were unlawfully killed in the Hillsborough disaster 36 years ago today

🚨 IPPR is currently recruiting for two roles! - Director of policy and politics - Senior economist Both close in one week. Find out more below 👇 www.ippr.org/jobs

Drive-a-GMC-Yukon-round-a-Tuscan-hilltown challenge.

The penguins will greet us as liberators.

This is a really important point from Ashwin Businesses can literally calculate the effects of the budget tax measures on their bottom line, but the big upsides of increased public investment are yet to come through, but businesses *will* feel those in time

According to the ONS' labour force survey, and government, 'spiralling inactivity' is one of the major problems facing the UK. But, even using the LFS, the rise is mostly young people being students. For other groups, after 2020, things are up and down. 1/2

See my blog on why the doomsayers on the economy are being overpessimistic and premature 🧵

Today's monthly GDP figures show a 0.1% increase in real GDP in November - the first positive reading in 3 months. It's encouraging but far from outstanding, and very clear that interest rates have become a drag on growth. The Bank of England must cut rates ASAP

🚨 NEWS! We're thrilled to announce Harry Quilter-Pinner (@harryqp.bsky.social ) as our new executive director. A leading figure in progressive politics, named by The Sunday Times as a key thinker influencing Labour’s economic policy, Harry will now steer us into the future.

It's good news that inflation is coming down. But with high interest rates and the looming threat of Trump’s tariffs, economic challenges remain. @ashwin-kumar.bsky.social on TalkTV 👇 www.youtube.com/watch?v=SYI3...

Universal Credit was supposed to simplify and improve work incentives but the reality is that it leaves an immensely complex system with some very high withdrawal rates and even some cliff-edges, where an increase in earnings leads to a drop in income www.financialfairness.org.uk/en-gb/what-w...

Good explanation of how - despite UC being far simpler conceptually than the benefits it replaces, its interactions with taxes and other benefits remain dauntingly complex. But worth remembering that MDRs not only show how little you gain from extra work, but also how much is lost when earnings fall

A great read showing how difficult it is for workers on UC to take on more hours. "The reality is that most low-paid workers are within the scope of Income Tax and National Insurance and so their effective deduction rate is 68 per cent." On min wage, this means people are left with £3.71 per hour.

Overlapping tax and benefit withdrawal means two-fifths of Universal Credit claimants will face effective deduction rates of more than 55% See my blog from new @mmuperu.bsky.social research funded by @financialfairness.bsky.social www.financialfairness.org.uk/en-gb/what-w...

Striking how the Dept for Education response to this @learnworkuk.bsky.social report STILL doesn't get the point that a key driver of the geographical skills divide is lack of demand - sufficient graduate jobs don't exist in many places so graduates migrate www.theguardian.com/education/20...

📢 @ashwin-kumar.bsky.social leads @ippr.bsky.social research and policy teams, and is also professor of social policy at @manmetuni.bsky.social. We are delighted to be welcoming Ashwin as a speaker at our Annual Conference 2025. 👉 Last few early-bird tickets remain: resolvepoverty.org/conference/

People across developing regions are spending far more time in school than 20 years ago

Workers in England more likely to be overqualified than global peers, finds OECD - on.ft.com/3OOAlZT via @FT (£)

Blimey. UK life expectancy worst in Western Europe - OECD report www.thetimes.com/article/52c5...

Watching the entire South African team - black and white - sing Nkosi sikelel' Afrika at the start of their T20 vs India is quite something. However frustrated we (quite rightfully) get with politics, it is always good to be reminded that things do change for the better

🎫 We are excited to announce that early-bird tickets for the Resolve Poverty Conference 2025 are now on sale. It will bring together people from across the country to explore how we can work locally to end poverty nationally. 👉 Book your place: resolvepoverty.org/conference

Losing faith in the American dream - lots in Andrew Gumbel's analysis. The question for the UK is the extent to which it has also been happening here. www.theguardian.com/us-news/2024...

Important point from @carsjung.bsky.social: estimates of growth effects of public investment from OBR don't include second-order effects such as increased business confidence or labour supply that general equilibrium modelling might show and so are likely to be on the low side

Increase in public investment hugely welcome but notable how many specific projects Rachel Reeves announced today. As with her predecessors, there are clear incentives for this but, in a more sensibly governed country, she might provide the money and specific decisions would be taken more locally

Striking that budget measure to recruit 5,000 extra tax collectors raises £2.7 billion by year five. Even if they cost an extra £100k each by year five, that's a rate of return of more than 5 to 1. With that kind of return, why wasn't the previous government doing this?

It's impossible for tax-raising measures to be completely pain free, but there are a collection of measures that focus on the better off and the main revenue-raising measure - employers NI contributions - raises money in proportion to earnings so more comes from the highest-paid

The budget is a welcome reversal of approach - public investment does matter and it's worth tax rises to get public services out of crisis mode