Chancellor’s hands tied by Brexit

Usually, the Chancellor’s Spring Statement is an important event in the Government’s calendar.

But this year, it passed by almost unnoticed, drowned out by the Brexit pantomime being played out in Parliament.

While Philip Hammond talked about a potential ‘deal dividend’ of around £27billion, it means nothing until a deal is concluded.

Hammond talked about “an economy that has defied expectations and will provide the solid foundation that Britain needs to seize the opportunities that the future offers.”

The positive messages from the Chancellor were dampened slightly by the Office for Budget Responsibility (OBR) which slashed its forecast of UK growth by a third, from 1.6% at the time of last November’s Budget to 1.2% now.

On a rolling 12-month basis it marks the lowest figure since the UK exited the 2009 recession.

Robert Chote, Head of the OBR, commented: “In recent weeks survey indicators of current activity have weakened materially, in part reflecting heightened uncertainty related to Brexit.”

Clients often ask me about the impact of Brexit on their financial planning and my response is always that a good, long-term, well diversified plan anticipates bumps in the road such as recessions, economic dips and even extraordinary events like Brexit.

Having said that, I don’t think there is anyone who doesn’t want to see an end to the uncertainty caused by Brexit. Without such certainty, it is impossible to understand the Government’s intended future direction of travel.