Britain is bringing back austerity. Here's why | CNN Business

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The last time a British finance minister revealed tax and spending plans, markets went haywire and the country's prime minister ultimately lost her job. The new government is not looking for a repeat performance.

The last time a British finance minister revealed tax and spending plans, markets went haywire and the country’s prime minister ultimately lost her job. The new government is not looking for a repeat performance. On Thursday, Chancellor Jeremy Hunt is due to unveil a budget that will aim to restore confidence in the United Kingdom’s ability to manage its public finances. But that may be easier said than done.

“We do have to do some tax rises, do some spending cuts, if we’re going to show we’re a country that pays our way,” Hunt told Sky News on Sunday. How did the United Kingdom get here? There’s no shortage of finger pointing. Part of the problem is global in nature. Interest rates have risen rapidly around the world as central banks attempt to rein in inflation. That’s pushed up borrowing costs for the government, dealing a shock after years in which money was cheap.

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