David Cameron is always at his best on budget day. This week his response was mocking. He dismissed as nonsensical the projections and figures which Alistair Darling gave to the House. And rightly so: it was the usual mixture of fairytale economics. But it was in keeping with Gordon Brown’s budgets — creative accounting applied to a nation, with cataclysmic results.
It is almost funny to hear Mr Darling talk about the fact that the government overspend will be £167 billion this year rather than £178 billion. Both figures represent a monumental failure of the policy adopted by the government. Our national debt will rise from £617 billion last year to £1,400 billion in 2014-15 — and the Chancellor had the audacity to describe this as ‘halving of borrowing’. Having run out of a statistical means of concealing debt, he is using verbal trickery. The annual increase in debt may halve over the four years, but the burden government places on taxpayers will more than double.
It is tragic — yet typical — that the loudest cheers from the Labour benches on budget day came not in response to fiscal plans but from blatant Tory bashing. Agreeing an ‘information exchange’ deal with Belize was intended to swing the spotlight on Lord Ashcroft. The 50p tax, to be introduced next month, is intended to embarrass the Conservatives. Almost every move in this and previous budgets is intended not as a means of serving the country but as a piece of hate mail directed at Notting Hill. It is partisan politics at its very worst, a war that leaves voters in the crossfire.
Having said this, Mr Darling is to be commended for the subdued tone of the Budget overall. There were no pre-election gizmos to dazzle voters with because, as the Chancellor knows, they would not have been believed. Entrepreneurs’ tax relief for capital gains tax was doubled to £2 million, and business rates cut. Abolishing stamp duty for properties under £250,000 has been a wise idea ever since the Conservatives first advocated it. He did what he could to salvage his own reputation before he passes into history as the Chancellor who picked up the most poisoned of all chalices from his predecessor.
On that last objective, we salute him. He has been a calm and resolute Chancellor, working in appallingly difficult circumstances, and repeatedly undermined by a Prime Minister who bears more responsibility than any other individual for creating those circumstances in the first place. He has stood up to the ‘forces of hell’ which he says were unleashed against him. The damage over the past decade could not be rectified or even cosmetically repaired at this five-minutes-to-midnight moment. And even now, no party dares spell out the scale of the cuts and tax rises that will be necessary.
Mr Darling’s last Budget was a sad bit of electoral window-dressing. It was a farewell note from a government that has been almost criminal in the extent of its economic incompetence. Mr Cameron said in his response that Mr Brown has been as irresponsible about pensions as Robert Maxwell. He could have gone on. The Prime Minister hedged bets more recklessly than Nick Leeson, concealed more debt than Enron and was a worse regulator of the behaviour of bankers than Fred Goodwin. The damage he inflicted on our economy will take a generation or more to rectify. Addressing this damage will be the task of the real budget: the emergency one in three months’ time.
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