- Former Bank of England chief economist Andy Haldane has urged the government to protect and expand the Treasury's financial headroom in the upcoming Budget.
- Haldane warned that reducing this buffer amid economic risks from ongoing wars in Iran and Ukraine would negatively impact borrowing costs and market stability.
- He called on ministers to exercise restraint on public spending and avoid increasing taxes on households and businesses to stimulate economic growth.
- Despite his recommendations, Haldane expressed concern that the chancellor will instead introduce tax rises and increased borrowing to satisfy backbench Labour MPs.
- Meanwhile, financier Jim O'Neill advocated using existing headroom rather than tax increases to maintain the UK economy's recent unexpected growth momentum.
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