The gap between how much money the state takes in and its spending will triple in the next 50 years, according to independent forecasters.

Public debt will rise due to an ageing and ill population as well as climate change, the fiscal watchdog the Office for Budget Responsibility (OBR) has said.

The ratio between debt and everything produced in the economy as measured by gross domestic product (GDP) will reach 270%.

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Latest figures show debt is nearly 100% of GDP.

Why?

The effects of climate change are estimated to damage the economy and public finances by adding between sums equivalent to 20% and 30% of GDP to the debt pile.

But there could be an improvement in the estimates by making everyone healthier, the OBR said.

Improved population health could reduce national debt expectations by more than 40% by the mid-2070s.

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As the population gets older fewer people are paying tax and more needs to be spent on health and care services, costing the state and raising debt levels.

It’s been described by the body as “unsustainable”.

As the combustion engine is phased out and motorists turn to electric vehicles revenue will be lost from fuel duty, cutting a key source of state revenue.

A carbon tax does not replace lost motoring taxes as fuel duty declines, the OBR’s report said.

What’s the OBR?

The office was established to crunch the public finance numbers, provide forecasts and analyse government budgets.

Its assessment of the long-term fiscal risks facing the economy was published on Thursday – a report which is typically published in July but was moved due to the UK general election.

The same warning was also made when last year’s report was issued.

Reaction

In response, the chief secretary to the Treasury said: “The OBR has laid bare the shocking state that our public finances were left in by the previous government.

“That’s why this government began work immediately to address the inheritance with tough choices on spending alongside ambitious action to drive growth. By fixing the foundations, we will rebuild Britain and make every part of the country better off.”

Tesco says it will accept a Supreme Court ruling in a so-called ‘fire and rehire’ case amid government efforts to bolster workers’ rights.

The Union of Shop Distributive and Allied Workers (Usdaw), along with three of its members at Tesco who also represent the union, took legal action over proposals in 2021 to fire staff at some distribution centres and rehire them on lower pay.

The case, which originally involved more than 360 workers – the majority at Livingston in West Lothian – arose after the supermarket chain offered staff higher “retained pay” to relocate in 2007.

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In 2021, the UK’s largest retailer announced plans to bring retained pay to an end and said that those affected would receive a lump sum instead.

If the offer was not accepted, the company said their contracts would be terminated and then reoffered on the same terms, but without the increased salary.

Usdaw argued that “retained” pay was described as “permanent” in the staff’s contracts, meaning it could not be removed, while Tesco said bosses were using a legitimate “contractual mechanism” open to employers.

The Supreme Court judgment followed earlier court wins for both parties – latterly Tesco at the Court of Appeal.

The five Supreme Court justices ruled unanimously that Tesco should be blocked from dismissing the staff.

They said: “Objectively, it is inconceivable that the mutual intention of the parties was that Tesco would retain a unilateral right to terminate the contracts of employees in order to bring retained pay to an end whenever it suited Tesco’s business purposes to do so.

“This would have been viewed, objectively, as unrealistic and as flouting industrial common sense by both sides.

“It would have been open to Tesco to negotiate a longstop date for the entitlement to retained pay or to make clear that the retained pay could be withdrawn if an employee were dismissed with notice and then re-employed in the same role. Neither was done.”

Following the ruling, Paddy Lillis, Usdaw’s general secretary, said: “These sorts of tactics have no place in industrial relations, so we felt we had to act to protect those concerned.

“We were very disappointed with the outcome in the Court of Appeal but always felt we had to see this case through.

“We are therefore delighted to get this outcome, which is a win for the trade union movement as a whole.”

The government has previously outlined plans to ban “fire and rehire” policies and exploitative zero-hours contracts, as well as enforce more rights from a worker’s first day in a job, including sick pay.

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A Tesco spokesperson said: “We accept the Supreme Court’s judgment. Our colleagues in our distribution centres play a really critical role in helping us to serve our customers and we value all their hard work.

“Our objective in this has always been to ensure fairness across all our DC colleagues. Today’s judgment relates to a contractual dispute brought on behalf of a very small number of colleagues in our UK distribution network who receive a supplement to their pay.

“This supplement was offered many years ago as an incentive to retain certain colleagues and the vast majority of our distribution colleagues today do not receive this top-up.

“In 2021, we took the decision to phase it out. We made a competitive offer to affected colleagues at that time and many of them chose to accept this.

“Our aim has always been to engage constructively with Usdaw and the small number of colleagues affected.”

A Department for Business and Trade spokesperson added: “We are committed to updating Britain’s employment protections so they are fit for our modern economy and the future of work.

“We will be bringing forward legislation soon to put an end to unscrupulous fire and rehire practices, which have no place in a modern labour market.”

Ryanair boss Michael O’Leary has said he is prepared to introduce a two-drink limit on his planes – if the same rule is applied to airport bars.

His call for alcohol restrictions comes after a “spike” in violent disorder among passengers over the summer.

Mr O’Leary told Sky News last month that Ibiza was one of the worst-affected destinations.

On Sunday, a Ryanair flight from Manchester to Ibiza was diverted to Toulouse in France after a group of passengers became disruptive.

Asked by Sky News if he would restrict passengers to two alcoholic drinks, Mr O’Leary said he would be “happy to do it tomorrow”.

He added: “If the price of putting a drink limit on the airport, where the problem is being created, is putting a drink limit on board the aircraft, we’ve no problem with that.

“The real issue is how do we stop these people getting drunk at airports particularly as, like this summer, we’ve had a huge spike in air traffic control delays.

“They’re getting on board with too much alcohol in their system. If we identify them as being drunk on board, we don’t serve them alcohol. But that doesn’t solve the problem.”

The Ryanair’s boss was speaking ahead of the company’s annual meeting in Dublin, where he told shareholders passenger traffic was on target to grow by 8% to 200 million this year.

Mr O’Leary also repeated his call for Martin Rolfe, the boss of Nats – the air traffic controller firm for many of the UK’s biggest airports – to be sacked over chaos at Gatwick Airport last summer.

“He’s demonstrated over a number of years that he’s incompetent,” Mr O’Leary claimed.

“It keeps breaking down as recently as last week, short-staffed at Gatwick. The Gatwick airlines had to cancel about 60 flights on Sunday.

“These repeatedly happen every summer. It’s not acceptable that someone who keeps delivering failure stays in his job. He should be dismissed.”

Nats said last year that the problems at Gatwick Airport had been caused by “an extremely rare set of circumstances” involving its technical infrastructure.

Mr Rolfe also apologised and said the organisation had “put measures in place to ensure it does not happen again”. He described Ryanair’s approach surrounding the issue as “abrasive” in a letter to a parliamentary committee.

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Meanwhile, Mr O’Leary also discussed the UK’s political outlook after previously saying Sir Keir Starmer “couldn’t be any worse” than the Conservatives.

He said on Thursday: “He’s getting his feet under the desk, it’s early days yet, but at least he has a big majority and you don’t have the kind of Tory psycho-drama going on”.

“Thankfully most of the Brexiteers have now lost their seats and are out in the wilderness,” he added.

Mr O’Leary also claimed that Brexit had done “untold damage to the UK economy” and called for closer UK alignment with EU rules.

He added: “It’s good for the UK and it’s good for Europe. I don’t think anybody wants the UK back in the EU, but Europe is still the UK’s biggest market, by some considerable distance.

“The Brexiteers have failed to deliver any of the trade agreements they promised at the time of Brexit… Most of them have left the stage despite being in charge when they delivered their shambolic hard-deal Brexit.”

A spokesperson for Nats told Sky News: “We are very sorry for Sunday’s disruption which was also disappointing for our highly professional Gatwick team, who are doing all they can to provide a seamless 24/7 service.”

They added: “This summer, since April, we have managed more than 124,000 flights at Gatwick, 2.7% up on last year and our service has been fully available over 99% of the time, 24 hours per day, every day.   

“Any cancellation is one too many. On the rare occasions when we have had to reduce the flow of traffic at Gatwick, we have done everything possible to minimise disruption.”