2021 Budget - the economic picture

2021 Budget - the economic picture

03 Mar 2021

Within his Budget speech, Chancellor Rishi Sunak unveiled billions in financial support for businesses and families adversely affected by the coronavirus (COVID-19) pandemic.

The Chancellor confirmed the extension of a number of COVID-19 support schemes, including the Coronavirus Job Retention Scheme (CJRS), which will now run until September, and the Self-employment Income Support Scheme (SEISS), which will continue with a fourth and fifth grant.

In its Budget report, the Office for Budget Responsibility (OBR) revealed that the UK economy is expected to recover to its pre-pandemic size six months earlier than previously anticipated, with expected growth of 4% this year.

The OBR expects the pace of UK economic growth to increase to 7.3% in 2022. However, it also stated that the pandemic is nevertheless still expected to lower the supply capacity of the economy in the medium term by around 3% relative to pre-COVID-19 expectations.

As the UK economy re-opens and COVID-19 fiscal support is withdrawn, the OBR revealed that government borrowing is forecast to fall from a high of £355 billion (16.9% of GDP) in 2020/21 to £234 billion (10.3% of GDP) in 2021/22. In 2022/23, as fiscal policy moves from rescue to recovery, the deficit is predicted to fall back to £107 billion.

Download our TaxApp Today

Tax rates, tips and calculators at your fingertips

Using the latest technology, our App has been developed to provide you with useful tax tools and information via your mobile device. Available for all mobile phones and devices.

Download for FREE now and simply save to your home screen.

The Ollis & Co TaxApp will always be technically up to date and keep you reliably informed.