UK Government Introduces Fiscal Lock Law to Prevent Unfunded Spending

New legislation mandates independent scrutiny of major tax and spending changes to avoid economic instability.

• The Budget Responsibility Bill requires the Office for Budget Responsibility (OBR) to assess significant tax and spending measures.
• The law aims to prevent a repeat of the 2022 mini-budget crisis under Liz Truss, which caused market turmoil.
• Temporary emergency measures, lasting less than two years, are exempt from the new scrutiny requirements.
• Critics argue the bill may not fully prevent reckless spending, as some significant measures might be classified as temporary.
• The bill is part of Labour's strategy to reinforce market credibility and public trust in the government's fiscal policies.

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