2018-10-28
LONDON (Reuters) - The end of austerity depends on the country reaching a deal on exit from the European Union, which would allow for increased public spending, but may have to adopt a different approach if there is no agreement, Finance Minister Philip Hammond said.
 
"If we do not make an agreement ... we will have to adopt a different approach to the future of the British economy," Hammond said in an interview with Sky News on Sunday.
 
"We will need to consider a different strategy, and frankly we will need a new budget that sets out a different strategy for the future," he said.
 
Hammond has angered many Conservative lawmakers who say he wants to maintain a very close relationship with the EU after the separation.
 
Britain has cut its budget deficit considerably since the financial crisis 10 years ago, but its debt levels remain high.
 
Most economists say Britain will suffer an economic shock if it leaves the EU without an agreement.
 
Hammond said he was very confident that Britain would negotiate an exit agreement from the EU that would minimize the likelihood of a trade dispute with the EU, but the government and the Bank of England should look into the situation and take action if there was no agreement