UK gilts set to fund welfare spending

By Bob Armitage is manager of the Govett Corporate Monthly Income Fund Markets rarely stand stil...

By Bob Armitage is manager of the Govett Corporate Monthly Income Fund Markets rarely stand still, but some of the changes afoot in the UK bond market may be of lasting significance. In the recent Budget, for instance, nobody knows exactly what the effect will be of a massive hike in taxation to fund additional welfare spending. This represents a major change in policy. We have become used to critics pointing out that Gordon Brown's revenue and spending projections were based on growth forecasts that erred on the side of caution. This time however, forecasts of growth of o...