First budget of Johnson government presented by Indian origin finance minister

Highlight:-

  • Special targeted funds for poor regions
  • The government might need to borrow funds this could add to the deficit

 

Rishi Sunak, Britain’s new finance minister had promised to provide billions of pounds to fight the outbreak of coronavirus, the bank of England would add boosters to this plan to avoid a possibility and risk of a new recession. However Sunak has a tricky job on his hands, he will deliver his first budget speech and present budget within a month of taking charge of the office, there is a special pressure on this speech as it would be presented as global stock are facing a huge drop and policymakers are expecting an influx of cash.

The plan previously presented by Sunak would help Prime Minister Johnson to direct the funds to developing or underdeveloped regions especially where voters helped him win with a large margin in the month of December. Although Sunak also mentioned the jump in public investment over the period of 5 years would be the highest achieved since 1955, it shows the positive jump in the market and represents a turning point after a decade of fighting economic difficulties to narrow down the budget deficit.

The Johnson government is also focusing on ways to fight the outbreak and spread of coronavirus and how to cope with the rising cases, to execute the budget properly and to achieve the spending priorities, the government would have to spend through its self-imposed borrowing rules. The British economy is at its 2 year lows and it has turned negative for the first time