we begin here in the uk, where the institute for fiscal studies is warning the chancellor big and painful spending cuts will be needed to put the country s finances on a sustainable path. the independent think tank predicts with a weaker economy and promised tax cuts, there will be a large shortfall in revenue. it calculates the government would have to spend £60 billion a year less by 2026 27. the treasury says its tax cuts and reforms would deliver sustainable funding for public services . more for public services . detail on that on october sist. joining me now is janet mui, head of market analysis, rbc brewin dolphin. they have quite a lot of detail as to why they believe the government will not have the money it needs to go ahead with plans? money it needs to go ahead with lans? ., ., ., plans? thanks for having me, first of all plans? thanks for having me, first of all before plans? thanks for having me, first of all before the - plans? thanks for having me, firs
the uk s formerfinance minister rishi sunak will formally become prime minister later on tuesday after an audience with king charles at buckingham palace. he was named conservative leader after his only challenger, penny mordaunt, pulled out of the contest. mr sunak promised to work to bring the party and the country together. it is the greatest privilege of my life to be able to serve the party i love and give back to the country i owe so much to. the united kingdom is a great country, but there is no doubt we face a profound economic challenge. we now need stability and unity, and i will make it my utmost priority to bring our party and our country together. so who is britain s soon to be prime minister? here s our deputy political editor, vicki young. addressing the nation during a pandemic, a month after becoming chancellor. you will not face this alone. rishi sunak helped lead to the government s economic response. the furlough scheme paid 80% of millions of people s sal
For the uk on the global stage, on the international financial times, they again get into the economic problems facing sunak, they talk about his capabilities, they say it is a call to action, we need a medium term debt cutting plan, they get into some positive signs, they say yield on gold has gone down and the pound rallied against the dollar, but he they say he has a daunting in trade ahead of him. well, earlier, ispoke to the economist david blanchflower who formerly sat on the bank of england s monetary policy committee. i began by asking what his shorterm economic outlook was with rishi sunak as prime minister. it s going to be very tough and he had the benefit of experience that he was the chancellor and he did very well with the furlough schemes and he did oppose what liz truss was going to do, so he
Doubt on that and concerns about inequality and that kind of environment it is very difficult for the economy to grow and get enough for school revenue to subsidise the tax cuts and debts we are going to see. ., . ., see. the chancellor did announce see. the chancellor did announce on see. the chancellor did announce on october i see. the chancellor did| announce on october 31 see. the chancellor did . announce on october 31 he see. the chancellor did - announce on october 31 he will set out a new debt cutting plan, and an accompanying official forecast in plan, and an accompanying officialforecast in a plan, and an accompanying official forecast in a attempt to calm down markets, so far that news has not made much difference, gilt markets got even worse yesterday? absolutely, it s because of the fact that we know that the gilt markets stabilised because the bank has intervened by committing to buy government bonds, we know that that programme is going to end this friday one octobe
The time something odd the timing is odd as well. after they said the 2.3 trillion debt cutting plan was enough and showed serious resolve on our part as a country to avoid default. apparently that was not good enough for the s&p folks who said the measures you are taking are not enough. to paraphrase, the fiscal consolidation falls short of what would be necessary. what would be necessary for a aaa rated country. the bottom line tonight, whatever the fall-out on investments and what they might yield in the open market, what we might have to given investigators to buy our securities the message is, it is going to cost us now. because the u.s. ratings agency has effectively said to the united states of america, you are no longer the best.