British media: Productivity forecasts are expected to be revised downwards, and the UK may face a fiscal gap of £20 billion.

According to Jin10 data on October 29, British media reported that UK Chancellor of the Exchequer Rachel Reeves is facing a blow from a significant downgrade in the official productivity forecast for the UK in the upcoming budget announcement. Analysts believe this adjustment could impact public finances by over £20 billion. According to insiders, the Office for Budget Responsibility is expected to lower the long-term productivity growth expectation by about 0.3 percentage points, which would increase the likelihood of future tax hikes, including income tax increases. According to estimates from the Institute for Fiscal Studies (IFS), for every 0.1 percentage point downgrade in productivity forecasts, net borrowing for the public sector in the 2029-30 fiscal year will increase by approximately £7 billion. Therefore, if the downgrade is 0.3 percentage points, the fiscal gap could reach as high as £21 billion.