Specialist Partner Andy King looks ahead at the Spring Statement and Budget

In anticipation of the Spring Statement, we sat down with Specialist Partner Andy to assess what clients should focus on ahead of the statement and the Budget later this year.

Tell us about your previous experience.

I’ve spent most of my career working in economic and fiscal policy in the UK. Between 1998 and 2013, I was in and out of the Treasury, ending up running the Fiscal Policy team for the Coalition’s first budget in June 2010 and then the Macroeconomic Coordination & Strategy team for the next couple of years. I spent the decade from 2013 at the Office for Budget Responsibility, first as Robert Chote’s chief of staff, then as a member of the executive Budget Responsibility Committee, focused on fiscal issues and estimating the impact of Budget policy measures. In quiet moments, I’ve spent time working with Finance Ministries in many countries across Africa and Asia with the IMF, and have recently worked with the Grantham Institute at the London School of Economics on the intersection between climate challenges and fiscal policy.

With a Spring Statement, Spending Review and Budget all coming this year, what are three things clients should focus on?

This is going to be a busy year on the domestic economic policy front. The Spring Statement was meant to be a quiet forecast update but looks set to be a ‘fiscal event’, with the Chancellor cutting spending to stay on track to meet her fiscal targets. The Spending Review looked tough with the need to squeeze most departments’ budgets to find extra money for the NHS, but now looks even tougher thanks to additional needs for defence spending. That’s a difficult backdrop for the Industrial Strategy, too, which is due in the coming months. And if fiscal pressures continue to mount, the Autumn Budget could involve uncomfortable decisions on tax.

Against this backdrop, three things for clients to keep in focus include:

• Innovative ways of financing good ideas. Changes to the fiscal rules last October and additional capital for the National Wealth Fund are designed to make space for financial investments to catalyse growth and clean energy. Some details are still to come and the Government is open to ideas for capitalising on the financing space created.
• Strong evidence for growth-enhancing projects and policies. With fiscal space at a premium, the Government will be looking to spend every pound wisely. That means following the evidence on what works, especially when that falls under a mission or a priority sector in the Industrial Strategy.
• Protecting key lines within unprotected budgets. The needs of health and defence will squeeze other budgets. As departments are forced to prioritise, there will be opportunities to defend what works – again, strong evidence will be vital. 

How do you support clients at Flint?

I lead our economic modelling offer – from policy analysis to economic impact assessments and more. These involve building evidence to support clients’ positions, be they the economic value of existing activities or benefit-cost ratios for proposed investments, the economic and fiscal impact of policy proposals, or evaluating economic scenarios exploring future trends like AI or the energy transition. As with everything at Flint, we marry our analysis with an understanding of the political and policy context – often using modelling approaches that are tailored to match those used inside government so that they are recognised and trusted by policymakers.

Why is economic modelling important for businesses to consider and/or invest in?

Engaging with political and official-level policymakers involves putting yourself in their shoes. What information do they need? What trade-offs are they having to make? That involves lots of things: political judgements, polling, parliamentary handling, administrative delivery, and, importantly, an attempt to understand what works or what impact a policy change will have. That’s where economic modelling comes in. There is huge value in being able to enter a conversation with policymakers with a good idea of what evidence they’ll want to see and what answers they’re likely to get when government analysts look into your issue.

From your years of experience, what’s your single biggest piece of advice for businesses when it comes to economic policy changes?

Do your best to find the right answer, which is not necessarily the most positive answer or biggest number. Policymakers receive lots of studies with inflated results and can spot where businesses have missed important parts of government-stipulated methodologies.

At Flint we are committed to helping our clients achieve their goals. We’d be happy to discuss how we can tailor our services to meet your specific needs. Get in touch with us to learn more!