The coalition has found the second year of co-habitation more difficult than the first and it will find the coming year even more difficult given that House of Lords reform is on the agenda. But today’s Budget is a reminder of the political benefits of coalition.
When George Osborne stands up today and announces, for instance, the reduction in the 50p rate he will do so with the support of two parties. Equally, a minority Tory government wouldn’t have been able to get more spending cuts to help finance a tax cut through parliament.
It also seems that there should be measures in the Budget to please both Tory and Lib Dem backbenches. In terms of the parliamentary performance today, there’ll be two things I’ll be watching out for during Osborne’s speech. One is how Tory MPs react to the rise in the income tax threshold. Do they try and claim the policy—which was in the Lib Dem manifesto not the Tory one—as their own through an enthusiastic, order paper waving reaction? Part of the reasons that the Liberal Democrats have tried so hard to claim ownership of this policy in the run up to Budget day is that they are scarred by last year’s headlines which declared that Osborne had raised the personal allowance and didn’t mention that it was a Lib Dem priority. The other is how do the Lib Dem benches react to the cut in the 50p rate, will any of them indicate their disagreement publicly?
But, overall, I suspect this Budget will be good for coalition unity. It will be a reminder to both sides that they can get a lot of what they want—if not all of it—out of government.
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