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£122bn Extra Borrowing Due to £59bn Brexit Impact And Chancellor’s Investment Increase Decision

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money by Petras Gagilas via flickr

Philip Hammond’s Autumn Statement decisions will not support ‘just about managing’ families – they will instead face both lower earnings and benefit cuts

Slower growth and higher inflation will mean higher borrowing and a parliament of falling living standards for millions – with the Chancellor missing an opportunity to provide much-needed support for just managing families – the Resolution Foundation said today in response to the Autumn Statement.

The Office for Budget Responsibility says that lower GDP growth, higher inflation and weaker earnings will increase borrowing by £84bn between today and 2020/21, with £59bn of that related to the decision to leave the EU.

In the face of significant extra borrowing the Chancellor has actually chosen to loosen fiscal policy further with a £14bn infrastructure programme and further classification changes, leading to a total of £122bn extra borrowing. The Foundation says that while such forecasts are highly uncertain they point to a structural deterioration in the public finances.

Today’s economic outlook also points to a significant weakening of living standards. New Resolution Foundation analysis shows that average real earnings are now forecast to be £830 a year lower in 2020, compared to the March 2016 outlook. The Foundation notes that just under half of this hit is due to higher inflation, with the reminder due to slower nominal earning growth. This also means that the National Living Wage, which is tied to typical earnings, is now forecast to rise to £8.80 in 2020 – lower than the much-discussed £9 figure.

The Foundation says that measures to raise the National Living Wage (NLW), provide some in-work support through Universal Credit, fund more affordable homes and ban up-front rental fees are welcome, but they fall well short of the action needed to make a big difference to living standards and support just managing families.

The Foundation notes that while the Chancellor has accepted significantly higher borrowing, he has chosen to leave the vast bulk of the planned welfare cuts intact, with welcome measures announced today doing little to reduce the big losses facing millions of just managing families.

New Resolution Foundation analysis shows that the double whammy of weaker earnings growth and ongoing benefit cuts mean that the poorest third of households are set to face falling household incomes over the parliament.

Looking at the impact across different family types, the Foundation finds that:

• A couple with two children (main earner working full-time on the NLW) will be £1,780 worse off overall despite measures announced today boosting their incomes by £190
• A couple with two children (one working full-time and the other working part-time on the NLW) will be £870 worse off overall despite measures announced today boosting incomes by £430.

Torsten Bell, Director of the Resolution Foundation, said:

“The big picture today is the new Chancellor accepting a major increase in borrowing, partly off the back of the Brexit vote, and choosing to increase it further with an expensive but welcome increase in capital spending. The result is £122 billion additional borrowing, with national debt reaching 90 per cent of GDP next year.

“The outlook for family finances that lies behind the big growth and borrowing figures is also bleak, with average earnings set to be £830 lower by the end of the parliament than previously forecast.

“Despite increasing borrowing elsewhere, the Chancellor has left the big welfare cuts intact and chosen not to provide significant support for the just managing families that Theresa May has rightly said she is focused on.

“The double whammy of lower earnings and benefit cuts mean that the poorest third of households are now set to face a parliament of falling living standards. In the months and years ahead the key task facing the government is to turn that situation around.”

Environment

4 Common Items That Can be Reused Again and Again

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reuse reduce recycle plastic bottles etc
Shutterstock Licensed Photo - By Vanatchanan | https://www.shutterstock.com/g/vanatchanan%20buahom

As a society we are getting much better at taking our obligations to the world and environment around us more seriously. This is undoubtedly a good thing! The effects of climate change are beginning to manifest across the world, and this is turning the issue from an abstract threat into a very real danger. Trying to introduce some greener, more eco-friendly practices into your life isn’t just a great way of doing something beneficial for society and the world around you. It is a wonderful way of engaging positively with the world and carries with it numerous psychological benefits.

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Being a greener, more ecologically friendly person doesn’t require any dramatic life changes. Breaking or making a few small habits is all it takes to make your life a greener one. In this article we look at one of the easiest, yet most effective green practices to get into: reusing everyday items.

Jars and Containers

Glass and metal are widely recycled, and recycling is a good thing! However, consider whether any containers you buy, whether it’s a tub of ice cream or a jar of coffee, can be washed out and reused for something else. Mason jars, for example, can be used to store homemade pasta sauce and can be washed for future use. Once you start thinking about it, you will find endless opportunities to reuse your old containers.

Soda Bottles

An ice-cold soda is a wonderful treat on a hot day, but buying soda can get expensive, and the manufacturing and distribution of the drinks themselves isn’t great for the environment. However, by holding on to your old soda bottles and repurposing them as water bottles, you can save money on drinks, or use them to measure out water for your garden.

Plastic Bags

Most of the time groceries come in paper bags, which are better for the environment than the plastic alternatives, but they are less durable and thus harder to reuse. Whenever the store places your items in a plastic bag, hang onto it so you can reuse the bags again. If you want to take it one step further, consider looking into buying some personalized recycled bags. These bags are designed to last for a long time and are made of recycled materials. They look striking and unique, they’ll turn heads, and maybe even attitudes!

Seeds

If you’re a keen gardener, then you will already probably know how to reseed your plants in order to ensure a fresh crop after each plant’s lifecycle. If you have space in your garden, or haven’t yet tried your hand at gardening, then consider planting a small vegetable plot. Growing your own veggies means that you’ll be helping to cut back on the emissions generated by their transport and production. The best part about growing your own food in this way is that, by harvesting properly and saving the seeds, you can be set up with fresh vegetables for life!

Reusing and recycling common household items is an easy way to make your world a little bit greener. Once you start looking for these opportunities you’ll realize that they’re everywhere!

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These 5 Green Office Mistakes Are Costing You Money

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eco-friendly green offices
Shutterstock Licensed Photo - By Stokkete | https://www.shutterstock.com/g/cyano

The sudden interest in green business is very encouraging. According to recent reports, 42% of all companies have rated sustainability as an important element of their business. Unfortunately, the focus on sustainability will only last if companies can find ways to use it to boost their ROI.

Many businesses get so caught up in being socially conscious that they hope the financial aspect of it takes care of itself. The good news is that there are plenty of ways to go green and boost your net income at the same time.

Here are some important mistakes that you will want to avoid.

Only implementing sustainability on micro-scale

The biggest reason that brands are going green is to improve their optics with their customers. Too many businesses are making very minor changes, such as processing paperwork online and calling themselves green.

Customers have become wary of these types of companies. If you want to earn their business, you are going to need to go all the way. Bring in a green business consultant and make every feasible change to demonstrate that you are a green organization from top to bottom.

Not prioritizing investments by long-term ROI

It isn’t realistic to build an entirely green organization overnight. You will need to allocate your capital wisely.

Before investing in any green assets or services, you should always conduct a long-term cost benefit analysis. The initial investment for some green services may be over $20,000. If they don’t shave your cost by at least $3,000 a year, they probably aren’t worth the investment.

Determine which green investments will have the best pay off over the next 10 years. Make these investments before anything else. Then compare your options within each of those categories.

Implementing green changes without a plan

Effective, long-term planning is the key to business success. This principle needs to be applied to green organizations as well.

Before implementing a green strategy, you must answer the following questions:

  • How will I communicate my green business philosophy to my customers?
  • How will running a green business affect my revenue stream?
  • How will adopting green business strategies change my monthly expenses? Will they increase or decrease them?
  • How will my company finance green upgrades and other investments?

The biggest mistake that too many green businesses make is being overly optimistic with these forecasts. Take the time to collect objective data and make your decisions accordingly. This will help you run a much more profitable green business.

Not considering the benefits of green printing

Too many companies believe that going paperless is the only way to run a green organization. Unfortunately, going 100% paperless it’s not feasible for most companies.

Rather than aim for an unrealistic goal, consider the option of using a more environmentally friendly printer. It won’t be perfect, but it will be better than the alternative.

According to experts from Doranix, environmental printers have several benefits:

  • They can process paper that has been completely recycled.
  • They consume less energy than traditional printers.
  • They use ink that is more environmentally friendly.

You want to take a look at different green printers and compare them. You’ll find that some will meet your needs as a green business.

Poorly communicating your green business strategy to customers

Brand positioning doesn’t happen on its own. If you want to run a successful green business, you must communicate your message to customers as clearly as possible. You must also avoid the appearance that you are patronizing them.

The best approach is to be clear when you were first making the change. I’ll make an announcement about your company‘s commitment to sustainability.

You also want to reinforce this message overtime by using green labels on all of your products. You don’t have to be blatant with your messaging at this stage. Simply provide a small, daily reminder on your products and invoices.

Finally, it is a good idea to participate in green business seminars and other events. If your community has a local Green Chamber of Commerce, you should consider joining as well.

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