PHILIP Hammond has taken a "gamble" with the public finances which could lead to higher borrowing and debt in coming years, a respected economic thinktank has said.
The Institute for Fiscal Studies said that the Chancellor may have "painted himself into a corner" by using a windfall from revised borrowing forecasts to fund increased spending on the NHS.
And it warned that tax rises are "all but inevitable" in the longer run to pay for the pressure on the NHS of Britain's ageing population.
Any expectation that Hammond will now meet his target of eliminating the deficit by the mid-2020s was "for the birds", said IFS director Paul Johnson.
Despite Hammond's claims that the economy has "turned a corner" on the way to the end of austerity, Johnson said that Monday's Budget was "no bonanza" for public services other than the NHS.
While the health service in England is set to receive £20.5 billion higher spending by 2023/24, spending on most other departments will be "essentially flat" over the coming five years once inflation is taken into account, said Johnson.
Johnson added this this could only be considered an end to austerity by a very narrow definition. However, on wider definitions, it is not an end to austerity, or "at least not yet."
Looking at the impact of the package on the public sector, he said: "This is no bonanza. Many public services are going to feel squeezed for some time to come. Cuts are not about to be reversed.
"If I were a prison governor, a local authority chief executive or a headteacher I would struggle to find much to celebrate. I would be preparing for more difficult years ahead."
Johnson said that the rise in income tax thresholds announced by Hammond would benefit the wealthy more than those less well-off, with a typical higher rate taxpayer gaining £176 a year and a basic rate payer gaining just £24.
And he said that, even after the injection of around £2 billion a year into Universal Credit, there would be "millions of losers" from the introduction of the new benefit.
The Chancellor's move to reverse previous cuts to UC was "a small increase in generosity compared to the cuts to working age benefits introduced since 2015 and small relative to cuts still to come," said Johnson.
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