1400, UPDATE: The technical problems should have been resolved now. The complete live blog is now showing below.
1346, PH: Cameron sits down, and we’ll sign off. Apologies, again, for the technical problems – I filled in some of the gaps below. More from Coffee House soon.
1345, JF: Turn to page 178 of the Red Book and you see something telling. This Budget predicts growth of three to three and a half percent in 2011. But the average of independent forecasts predicts growth of 2.1
percent. Indeed, the Red Book cannot cite an independent forecast that predicts 3.5 percent growth in 2011.
1345, PH: Cameron’s on punchy form, hitting out at the dispatch box. He asks why the public would want to stick with a government that presided over the longest recession in history. “It’s like the captain of the Titanic saying ‘let me command the life boats’ … It’s like Richard Nixon saying ‘I’m the man to clean up politics’.”
1335, PH: Technical problems still very much getting in the way, but it’s worth noting that Cameron has started his response. His key message, so far, is the right one: that lower borrowing forecasts aren’t much to shout about when borrowing and debt is so high. He also highlights how some of the goverment proposals were made by the Tories first.
1327, PH: There weren’t many exciting or unexpected spending measures in Darling’s speech – but they steadily racked up nonetheless. By contrast, there weren’t many new spending cuts or tax rises that will raise much money for the Exchequer. In the meantime, Darling is leaning heavily on those “higher than expected” tax receipts to make his deficit reduction plan seem credible. I suspect the markets will remain unconvinced.
1325, FN: The biggest cheer of the day goes to Darling’s deal with Belize for information on tax exiles. “We expect these deals to be signed within a few days, which is rather quicker than the ten years that it has
taken the front bench opposite to exchange information with their deputy chairman”. Brown gives that smile, a genuine warm one, one that you only ever see when he believes the Tories are being shafted.
1325, PH: Apologies, a few technical problems are slowing things down and have deleted entries between 1302 and 1315 [UPDATE: they’ve been added below now]. Should hopefully be up and running again shortly. What did you miss? New measures for small business including a new a further £94bn worth of loans from RBS and Lloyds next year; a new credit adjucation service which threatens to become a legal minefield; and a new business investment fund. Also, there’s more money for roads, railways, green energies and universities. Oh, and higher duty on alcohol.
1315, PH: There the business tax cut I was hald-expected yesterday: business rates will be cut by 1 percent, for one year, from October.
1314, PH: More than a hint of central planning to Darling’s growth plan. The government will ensure that 15% of government contracts go to small businesses
1313, PH: As expected, there’ll be a new business investment body – with £500 million of cash to pass around. Businesses will also be able to take their cases to a credit adjucation service, if they don’t get credit from banks. This, I imagine, could turn out to be a legal nightmare, as businesses and banks duke it out on government turf.
1311, PH: Darling’s going for growth now: “We need to ensure that SMEs get the the credit they need”. He says that the government will ensure that RBS and Lloyds provide £94bn more loans.
1309, PH: This is all as expected so far, and pretty dull with it. Question is: will there be a sting in the tail?
1307, PH: Will we get the spending cuts we need? Well, let’s just say that Darling is using the words “efficiency” and “savings” a lot. One of his measures to to relocate civil servants outside of London. He says that civil servants in the capital will be cut by a third – which sounds like a diluted version of the Tories’ plan to cut Whitehall bureuacracy by a third.
1306, PH: Big cheers as Darling fires through Labour’s “guarantees”. But how much will they cost? And what happens if they aren’t met? These could get very messy indeed.
1306, FN: “We have not raised these taxes out of dogma or ideology,” he says, the rich “should now pay their fair share of tax”. This is a nod to the 50p rate coming in next month, making Britain the only country other than Iceland to increase the top rate of tax. If it wasnt dogma, what was it? Not economics: the IFS says this would lose £800m. But Cameron uses that line – “fair share” as well. The top 1% pay 23% of income tax now. Is this what these two describe as a fair share or not? Note Darling talks of high earnings as if money falls from the sky, and people have “benefitted” from economic growth rather than generated it.
1305, PH: There’s Darling trying to defuse the military funding issue, post Chilcot: there’ll be another £4bn for Afghanistan next year.
1304, PH: Long passage on how cutting spending this year would “risk the recovery”.
1303, PH: Claims that government tax measures will raise £19bn for “cutting borrowing”.
1302, PH: No changes on VAT, national insurance etc. But higher duties on alcohol.
1301, PH: Darling’s rattling through tax measures for higher earners – he adds that these measures aren’t implemented out of “dogma or ideology”. Laughter from the Tory benches.
1300, FN: Listen to him milking the sole piece of good news – a revision of PSNB from £178bn to…. to…. oh let him talk for a bit more about tax revenues being higher than expected … £167 billion. Shows what a poor condition our economy is in that an overspend of £160bn – 12% of GDP, unprecedented in our peacetime history – is regarded as some kind of triumph.
1258, PH: Darling says that the deficit-reduction plan is now the fastest of any G7 country. Brown claimed this a few weeks ago, and it was untrue, so this figure should be claim with extreme caution.
1256, PH: Darling says that higher-than expected tax receipts mean that borrowing this year is £167bn (it was £178 in the PBR). It will be £163bn next year. And the upshot is it will be £8bn lower than the PBR forecasts in 2014-15. Darling adds that this means overall debt will be £100 billion lower in 2014-15 . This is what Labour will try to push: but remember debt will still be pushing 1.7 trillion. That’s hardly worth cheering about.
1245, FN: Trying to make light of the appalling spike in UK inflation (note how he doesn’t list European comparisons here – I wonder why not!). Why does he think it’s so high? Might QE have anything to do with it?
1244, FN: Listen to Labour roar in approval with stamp duty of 5% on properties costing £1m and more. Good bit of class war.
1253, PH. Now there’s a surpise: Darling downgrades his wildly optimistic growth forecasts for next year. Not by much though: from 3.5 percent to 3-3.5 percent. Still looks a bit fanciful to me.
1252, JF: Brown’s tie matches Harman’s jacket, a rare example of joined up government from this administration
1251, FN: Here’s the link for the report showing that taxpayers won’t get back their money, as Darling just claimed. About two thirds of the way down, it looks at recovery rates for the taxpayer. Directly contradicts Darling’s claim – forged by Brown in the Politics Show the Sunday before last.
1250, PH: A double-whammy of copied Tory ideas. Darling says that the government will start reconsidering retirement ages. And Darling says that he will double the stamp duty holiday to £250,000.
1249, PH: Now Darling’s setting out some of Labour’s “guarantees”: training or work for 24 year-olds, that kind of thing. Worth looking for how much these guarantees will cost.
1246, PH: Darling says that a “decade of welfare reform” has limited unemployment during the recession. I wonder what Frank Field would say about that. And, indeed, the 5.4 million people on out-of-work benefits – a figure which has remained constant since 1997. Around a million of those have been on benefits for 12 years.
1245, JF: Tax has raised twice as much as forecast because it failed in its stated aim, to change behaviour
1244, PH: More Tory-bashing from Darling: “We could have listened to those who opposed these measures…” Now he’s making some spurious claims about how many businesses have been saved by Labour policy.
1242, PH: This sounds more bluntly political than Darling’s other Budget speeches – there are plenty of nods towards “do nothing Tories”. In the meantime, there’s little meat on the bone.
1242, FN: “We intend to get all taxpayers’ money back” – that’s not what the FSA has said in its report estimating what the net loss will be due to the Singer and Friedlander interventions – ie, what the taxpayer is formally forecast to lose. I wonder if No10 knows that the FSA has done this? Gives the lie to Darling’s line about getting the money back.
1241, FN: “Secure the recovery” – that’ll be a Labour campaign theme. Also his trick “halve the deficit within four years” – by making it into a boast, he disguises just how lame this is. Italy will have eliminated its deficit by next year.
“A storm which began in America spread rapidly around the world” – nope, the UK economy was geared up to a dangerous level by a reckless Chancellor.
“Economic disaster was averted” – depends if you consider the trebling of national debt burden as a disaster or not….
1240, PH: He claims that a tax on bankers’ bonuses has raised £2bn – “more than expected”. Let’s see how that gets used.
1239, PH: Darling says that the banking bailouts were the “right decision,” and claims that taxpayers will “get all their money back”. Might take some time, that.
1237, FN: He’s using the changing forecasts and hailing that as a victory. The words “straws” and “clutch” spring to mind.
1236, PH: Now Darling’s into the “global problems” bit of his speech. He says that the government’s “unprecedented action” has staved off the worst of the recession – and drops in some innuendo about the “do nothing” Tories.
1235, PH: Darling says that a £2.5 billion “growth package” will be at the centre of the Budget.
1234, PH: Darling’s intro is straight from the Brownite copybook. He talks about taking the “big choices,” and “protecting the recovery”. He adds that borrowing forecasts will be lower than they were last year.
1233, PH: Darling steps up to the dispatch box. For what it’s worth, he’s wearing a dizzying spotty tie.
1230: So that’s PMQs done with. Now to the day’s main event: the Budget.
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