From Action on Smoking and Health <[email protected]>
Subject ASH Daily News for 26 September 2022
Date September 26, 2022 12:25 PM
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** 26 September 2022

** UK

** IFS: Mini-Budget response (#1)

** Study: Women and smokers at highest risk of dying early from type 2 diabetes (#2)

** Mini-budget benefits London and south-east England, study shows (#3)

** Liz Truss's top aide Mark Fullbrook paid by his own lobbying firm (#4)

** UK

** IFS: Mini-Budget response

The Institute for Fiscal Studies (IFS) has published a response to Kwasi Kwarteng’s “mini-budget”, highlighting that the budget sees, “the biggest tax cut to the planned level of tax of any budget since 1972”.

On public finances, the IFS said:

“[…] borrowing this year is now on course to climb to £190 billion. At 7.5% of national income this would make it the third-highest peak in borrowing since the Second World War, after the Global Financial Crisis and the COVID-19 pandemic. […] By 2026-27 we now forecast that borrowing will be over £110 billion - 3.9% of GDP - which is more than £80 billion higher than the £32 billion forecast by the Office for Budget Responsibility in March. Over half of this increase in borrowing is due to the almost £45 billion a year of tax cuts announced by the Chancellor today.”

On public spending and public services, the IFS said:

“[Whilst] today’s fiscal event was almost entirely focused on tax; there were precisely zero new public spending announcements,” there was one change relating to public spending which was not published in any official documents and comes as a consequence of Kwarteng reversing Rishi Sunak’s increased National Insurance (NI) contributions in 2021. The IFS highlight that, when, the former Chancellor introduced the increased NI contributions he also introduced £2billion of extra funding to public services each year to compensate for the additional employer NI costs, which the new Chancellor has now reversed.

The IFS said: “From 2023-24, the Treasury is withdrawing that compensation from departments: the employer NICs cut means their staffing costs will be lower, and their budgets will be reduced by a commensurate amount. Public services will be no worse off as a result of this change (had the compensation been left in place, they would have been better off). On aggregate, spending plans are left unchanged, because the money will be taken from departments and moved into the Reserve, to be used to meet any unforeseen future costs in future years (such as the costs of any military aid to Ukraine). It is important to remember, though, that due to higher-than-expected inflation, public services are still worse off than they were intended to be when public spending plans were set out last year. Departments have been told to pay for the costs of higher-than-expected pay awards from within existing budgets. A tough winter for public services lies ahead.”

Source: IFS, 23 September 2022

See also: NHS Employers - Mini Budget and UK growth plan 2022 ([link removed])
Read Article ([link removed] )

** Study: Women and smokers at highest risk of dying early from type 2 diabetes

Women, young people and smokers are more likely to die from type 2 diabetes, according to a new study carried out at Salford Royal Hospital, presented at the European Association for the Study of Diabetes in Stockholm.

The study observed 11,806 patients with type 2 diabetes over a period of 10 years, and found that women with Type 2 diabetes have a 60% increased risk of premature death, and on average, will live five years less than a healthy woman whilst men who are diagnosed, have a 44% increased risk of dying prematurely and will live around 4.5 years less.

The study also found that smoking poses the biggest risk to those diagnosed with the disease, as life expectancy of smokers was shortened by 10 years.

Source: The Independent, 21 September 2022
Read Article ([link removed])

** Mini-budget benefits London and south-east England, study shows

The chancellor’s mini-budget will disproportionately benefit London and the south-east, a new analysis by the Resolution Foundation has found, marking a sharp U-turn from the levelling up strategy of the previous government.

According to the thinktank, households in London and the south-east could gain an average of £1,600 next year from Friday’s fiscal statement. This is three times as much as those in Wales, the north-east and Yorkshire, which it predicts will gain an average of £500.

Its calculations also found that overall, Kwasi Kwarteng’s new tax and benefit policies will result in those on middle incomes losing most, with the poorest fifth of households gaining an average of £90, the middle fifth losing £780 and the top 5% of earners gaining £2,520.
The incomes of the richest 5% will grow by 2% in the next financial year as a result of the tax cuts, the thinktank said, while the remaining 95% of the population will get poorer as the cost-of-living crisis mounts. An additional 2.3 million people will fall below the poverty line, it estimates, including 700,000 children.

The Resolution Foundation’s findings come after the Institute for Fiscal Studies thinktank said the chancellor was “betting the house” by putting government debt on an “unsustainable rising path”.

Source: The Guardian, 24 September 2022

See also: The Resolution Foundation – Blowing the budget: Assessing the implications of the September 2022 fiscal statement ([link removed])
Read article ([link removed])

** Liz Truss's top aide Mark Fullbrook paid by his own lobbying firm

Political correspondent for the BBC, Damian Grammaticas, reports The Prime Minister’s closest aide, Mark Fullbrook, is not paid directly by the government. Liz Truss appointed Mr Fullbrook as her chief of staff earlier this month.

The BBC report states: “[Fullbrook’s] salary is reported to be paid via his own lobbying firm Fullbrook Strategies, which was set up in March. This is despite the fact that the firm's website saying it "has currently suspended its commercial activities".”

Grammaticas also states, “A spokesperson for Mr Fullbrook told BBC News: "This is not an unusual arrangement. It was not put in place for tax purposes and Mr Fullbrook derives no tax benefit from it." However, the spokesperson did not respond to questions about whether Fullbrook Strategies had suspended "commercial activities" and, if it had, why it might be hiring Mr Fullbrook on “secondment to the government.”

According to the report, “Downing Street and the Cabinet Office, which is directly responsible for employing Mr Fullbrook, have both refused to confirm exactly how he is employed and paid.”

Source: BBC News, 25 September 2022
Read Article ([link removed] )
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