Five things we learnt from Rishi Sunak’s Spending Review

Rishi Sunak laid bare the state of the public finances as he set out the Spending Review to the Commons.

Here are five things we learnt from the Chancellor’s statement.

Finances face a chill wind

Mr Sunak painted a grim picture of the public purse as he told MPs the economic emergency caused by the pandemic has only just begun and there will be “long-term scarring”.

He said the Office for Budget Responsibility (OBR) did not expect the economy to return to its pre-crisis levels until the end of 2022 and the damage was likely to last.

The budget watchdog’s forecast expects Gross Domestic Product (GDP) – the total value of all goods and services in the UK – to shrink by 11.3% next year – the largest annual fall since the Great Frost of 1709 when much of Europe was hit by a bitter cold spell.

The Chancellor said underlying debt would continue rising, reaching 97.5% of GDP by 2025-26, but he stressed that “the costs of inaction would have been far higher”.

What about Brexit?

Mr Sunak did not once mention the B-word in his almost 3,000 word-long statement.

But with just 37 days to go until the end of the transition period, Brexit did feature heavily in the OBR’s report.

It forecast that, even with a free trade deal with the European Union, there would be a “4% long-run loss of output”.

A no-deal would lead to a further 2% drop, a move that would also have an impact on employment and consumer prices, it suggested.

No laughing matter

Budgets are usually riddled with terrible jokes and chancellors are permitted to drink alcohol during their speech.

Though this was a Spending Review, there is usually room for a political pun or two – but Mr Sunak decided to leave the jokes at the door.

The last such review in 2015 had more light-hearted moments, the most infamous of which came from the opposition benches when then-shadow chancellor John McDonnell brandished a copy of Chairman Mao’s Little Red Book.

The veteran left-winger seemed to be trying to make a joke about the Government’s courting of Chinese investment, but it left many on the Labour benches cringing.

Was Sunak pitching for top job?

The Chancellor ended the Spending Review with his vision for every person in the country to get the chance to meet their potential.

It was an unusual ending to a statement that had been very number-focused, prompting speculation from Westminster watchers that Mr Sunak may have been subtly setting out his pitch to be the next PM.

He said: “We in government can set the direction, better schools, more homes, stronger defence, safer streets, green energy, technological development, improved rail, enhanced roads, all investments that will create jobs and give every person in this country the chance to meet their potential.

“But it is the individual, the family and the community that must become stronger, healthier and happier as a result.”

Even the Speaker can fluff his lines

Sir Lindsay Hoyle is usually the one correcting MPs for slipping up, but at the start of the statement on Wednesday it was him who made a mistake.

The Commons Speaker took to his feet for a bit of housekeeping before introducing the Chancellor, but he read from the wrong script.

Sir Lindsay accidentally re-announced lines that he had only moments earlier delivered at the end of Prime Minister’s Questions, before realising his mistake.

He then, as intended, pointed out that a British Sign Language interpretation of the statement would be available to watch online.