United Kingdom economy to grow more slowly after Brexit, finance minister says

It also hiked forecasts from £38.8 billion to £59 billion for 2017/18, from £21.4 billion to £46.5 billion for 2018/19, from a surplus of £10.4 billion to a deficit of £21.9 billion for 2019/20, from a surplus of £11 billion to a deficit of £20.7 billion for 2020/21 and a deficit of £17.2 billion in 2021/22.

Britain's decision to exit from the European Union, or Brexit, following a referendum in June, means the United Kingdom will grow only 1.4 percent in 2017 and 1.7 percent in 2018, compared with forecasts in March for growth of 2.2 percent and 2.1 percent, respectively, Hammond said Wednesday.

On the chances of Mr Hammond wiping out the deficit by 2012, Mr Chote said: "That will be quite a challenge, especially if he needs or decides to borrow more during this Parliament".

Hammond said the projected growth slowdown was due to "lower investment and weaker consumer demand, driven.by greater uncertainty and by higher inflation resulting from sterling depreciation".

In its latest independent forecasts since March, the OBR upgraded its outlook for United Kingdom gross domestic product (GDP) from 2% to 2.1% for this year.

"But the Prime Minister and I remain firmly committed to seeing the public finances return to balance as soon as practicable, while leaving enough flexibility to support the economy in the near term".

He said he would not "make significant changes twice a year just for the sake of it".

Britain will need to borrow £122bn more over the next five years than was expected before June's European Union referendum.

Britain is expected to run a budget deficit of almost 22 billion pounds in the 2019/20 financial year which until recently had been the target date for a first budget surplus, Hammond said, citing forecasts from the budget office."The prime minister and I remain firmly committed to seeing the public finances return to balance as soon as practicable. while leaving enough flexibility to support the economy in the near-term", he said.Hammond said he would stick to a business tax road map set out in March and that he would change the tax treatment of past business losses to ensure firms always pay tax in the years they make a profit.

It said Mr Hammond could be blown off course by Britain's stubborn failure to improve economic productivity, which was still the "most important uncertainty".

Introduced in 2012, the triple-lock guarantees the state pension rises each year by whichever is highest - price inflation, average wages or 2.5% - but it has been criticised as being unsustainable and unfair. Big handouts would require a reversal of past cuts to income and corporate tax.

The tax-free personal allowance will increase to £12,500 by the end of the Parliament, with a higher rate threshold of £50,000.

An extra £50m a year will be used to fund grammar school expansion.

The biggest shock, in fact, came at the fag end of Hammond's hour-long speech as the former foreign secretary announced his first Autumn Statement would also be his last, with the event set to be replaced by a Spring Statement from 2018.

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