Money, Money, Money

 Economics isn't hard, if you pay out more than you bring in then you are in a deficit and that is as true for a household budget as it is for a countries but that message is too simple for economists so they try and make it sound more complicated so people like me just say 'yeah, whatever' and leave them to it
which is why we all get screwed so badly by the succession of Chancellors and the current one has found what he is calling 'Fiscal Headroom' to give us all a tax cut just before the election.
'So' i said to my economist pal, 'Fiscal headroom, without boring me to tears, what is it, how much headroom and how come we got money to spend now and not previously?
The answer to What is it's the amount of money the Chancellor has to spend, the How Much is £13bn and How Come Now is because the Tories are sinking without a trace in an election year.            
It turns out that last year the Fiscal Headroom was £6 billion but each Chancellor has there own way of working out just how much headroom they have by looking at the debt today and forecasting how much the debt will be in the future and Mr Hunt can see that todays debt to GDP is 90.2% but in 2027/28 the Office for Budget Responsibility say it will be 94.9% but in 2028/29 it is forecast to fall to 94.4% which in monetary terms is approximately £13 billion.
We seem to be glossing over the hang on, the debts going up from 90.2% to 94.4% in 2028/29 so how is there any fiscal headroom whatsoever but that is drowned out by the Chancellor whoo-hooing that he has somehow ended up with £13 billion from somewhere in the future and now has to decide what he is going to spend it on.
After 14 years of chronic underfunding he could hand it to the NHS, he could splash out on flood defences, he could give it to Civil and Public Servants after a decade of wages freezes, he could use it to recruit the 20,000 police which the Government have cut in the last decade or he could even hand it over to the Education Secretary to fix schools which are literally collapsing around pupils ears but instead, he has decided to cut 1-2p off Income Tax.
Obviously that would be gratefully received considering that through a sleight of hand where the Personal Allowances have not been increased so as our wages go up so does the amount of tax we pay, cutting a penny or two would just return us to the tax we paid before he froze the allowances so in effect the net wages that we were on 2 years ago.
He could just not spend it and save it but the cynic in me thinks that by spending the whole lot, he will leave an incoming Labour Government nothing in the national piggy bank for their plans which include spending tens of billions on increasing the Green Energy Sector, improving the NHS and reversing the austerity cuts if the funds are available, which they wont be because Jeremy Hunt is going to make damn sure there won't be.