Policymakers should keep an open mind on productivity

Last week saw the Chancellor, Rachel Reeves, take delivery of the first Autumn forecast from the UK’s budget watchdog, the Office for Budget Responsibility (OBR). Dominating the forecast will have been an updated estimate for how fast the OBR believes the UK economy can grow. That productivity estimate is widely expected to have been cut from their Spring forecast. The scale of that cut will largely determine the scale of tax increases required at the upcoming Budget.