With the UK experiencing its warmest February day on record earlier this week, spring has sprung and with it - on Wednesday, 13 March 2019 - is the Spring Statement.

The statement is the Treasury's first annual update on the country's economic health, and this year it has the added significance of arriving just a fortnight before Brexit.

Chancellor Philip Hammond loosened the purse strings when delivering Budget 2018 last November and he left the door open to make the Spring Statement a bigger deal than last year's non-event.

"If the economic or fiscal outlook changes materially in-year," said Hammond. "I will take whatever action is appropriate, including the right to upgrade the Spring Statement to a full fiscal event."

Spring Statement 2018 lasted less than half the length of any of Hammond's previous speeches as the Chancellor delivered on his promise to move away from two fiscal announcements every year.

What is a full fiscal event?

Each year, the Chancellor makes a Budget statement to the House of Commons to outline the state of the economy and the Treasury's potential tax changes.

MPs debate the potential changes in the Commons before scrutinising the subsequent Finance Bill, which enacts the Chancellor's proposals.

Historically in the UK, we have had two financial events each year - the Budget, and the Statement - which can both be used to announce changes to taxation and economic forecasts.

What is Spring Statement?

The first fiscal announcement of the calendar year used to be the Budget, which was delivered just weeks before the start of a new financial year in April.

In 2016, however, Hammond moved the Budget to the autumn and the Spring Statement is the Treasury's response to the bi-annual forecasts from the Office for Budget Responsibility.

What can you expect?

Last year's Spring Statement was a subdued affair. There was no red briefcase, no red book, and no tax changes as Hammond announced updated economic forecasts.

He also announced a string of consultations, some of which were rubber-stamped during the Chancellor's Budget speech in November 2018.

This year, we have an elephant in the room in the shape of Brexit. Hammond could use the Spring Statement to go back on largely popular tax changes announced last autumn.

Alternatively, the Chancellor could use the Spring Statement to divert attention away from the UK's ongoing failure to reach an agreement over the terms of its exit from the EU.

Given that there are no rumours being leaked to the press at this stage, another low-key response to economic forecasts is expected to be delivered after Prime Minister's Questions on 13 March 2019.

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