Hammond to borrow extra £90bn after lower productivity forecast

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OBR warns chancellor faces long period of sluggish wages growth that will dent tax receipts and increase borrowing

Philip Hammond must borrow an extra £90bn over the next five years after the Treasury’s independent forecaster downgraded productivity growth.

The Office for Budget Responsibility (OBR) warned that the chancellor faced a long period of lower than expected wages growth that would dent tax receipts and push up borrowing. The cumulative effect over the life of the parliament would add £90.5bn to the UK’s debt pile and jeopardise Hammond’s target of balancing the government’s books by 2025, it said.

Related: The real budget story is the sharp cut in growth forecasts | Larry Elliott

The Office for Budget Responsibility is the government’s independent forecaster, which gives its verdict on the outlook for growth and the public finances twice a year.

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view The Guardian: Economics
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