Budget

Which departments will fare the worst from this week’s Budget? It won’t be the Department for Health and Social Care. Over the past few days, new funding announcements have appeared in the papers meaning the NHS will be handed another £5.9 billion. That’s in addition to the £12 billion a year investment it will receive as a result of the health and social care levy. Meanwhile, Whitehall sources suggest that Michael Gove has had some luck in his push for more funds for the levelling up agenda. Where the mood music is less positive is education. When Sir Kevan Collins stepped down from his role as Boris Johnson’s education catch-up tsar over the

Rishi Sunak’s tax hikes pack a punch: by 2025, over £19bn is estimated to be raised from the freeze to the personal tax threshold, and a staggering £50bn from a new, tiered corporation tax structure. That’s a lot of people out of pocket, and businesses diverting their profits away from workers and consumers and towards the state. Criticisms of the cash grab are splashed across the front pages of the papers today. Across the pond, the Wall Street Journal has lambasted Sunak’s policies: ‘Britain’s political class, and especially the governing Conservative party, prides itself on fiscal rectitude. So Mr. Sunak already faces pressure to “pay for” all this relief. We

Rishi Sunak’s planned corporation tax hike is a reminder of the importance he sets by trying to put the public finances on a sounder footing. He think that his room for manoeuvre in this crisis has been, in part, because the public finances were in reasonable shape before it.  The vaccination programme remains this government’s most important economic policy As I say in the magazine this week, his concern about debt has long been about the cost of servicing it (which remains low) rather than its precise level. But the debt pile is now so large that small movements in interest rates have big consequences. But straightening out the public

Labour is terrified of Rishi Sunak. Today’s Budget showed exactly why. The Chancellor put in an impressive performance: It was assured and hit the right notes at the right times. It also laid the groundwork for a narrative on the economy that will work very well for the Tories. Sunak told voters that George Osborne’s cuts created the money that comprised the Covid recovery spending. This ties together the whole of the last decade of Tory rule in a neat package – something Boris Johnson has avoided doing with his ‘I’ve only been Prime Minister for five minutes’ routine. Labour folk will now complain and shout ‘Tory austerity!’ until they are blue in the face.

When Rishi Sunak takes to the Despatch Box on Wednesday it will be against a backdrop of colossal national debt, the recent rise in government bond yields and the ongoing Coronavirus crisis. The British state owes £2.1 trillion, ten times the size of the entire economy of an independent Scotland. Yet some concerns over the health of the public finances are misguided – or at least exaggerated. The increase in borrowing to pay for Covid does not itself have to be repaid (at least in the short term). Why? Because provided the government can continue to make the interest payments, debt can simply be rolled over. What’s more, the UK

Rishi Sunak kept his Budget cards close to his chest this morning as he toured the studios for both BBC One’s The Andrew Marr show and Sky News’ Ridge on Sunday. The Chancellor batted away questions about spending and possible tax hikes, repeating over and over again that it’s only ‘appropriate’ to wait until the fiscal event this Wednesday to reveal the details of his plans. There were hints towards areas that have taken the Chancellor’s interest, including a passing comment about ‘business investment’ on Sky News – a bugbear of many on the right, who have long-argued that the UK’s corporate tax rate regime is ungenerous to businesses that

We already know much of what will be in Rishi Sunak’s Budget next week. Another £30bn for Covid-relief measures: furlough scheme into the summer, stamp duty holiday and the uplift in universal credit (which is also expected to be time-limited, despite pressure from the opposition to make a permanent adjustment). But this year’s spending splurges are becoming a footnote in a Budget dominated by the prospect of tax rises, for which the Chancellor is already receiving backlash from the left and right. Rumours of a corporation tax hike, circling for a week now, have not been denied. There’s also talk of capital gains tax coming under the Treasury’s spotlight, with

How will Rishi Sunak’s Budget land with Tory MPs? As reports circulate in the press that the Chancellor is considering raising corporation tax and capital gains tax as well as bringing in a stealth tax for pensioner savings, nerves are growing among Conservative politicians.  The Northern Research Group of MPs, chaired by Johnson’s old friend Jake Berry, have called on Sunak not to tax his way out of pandemic debt by raising business taxes in the budget. Tory MPs such as David Davis have warned they could refuse to vote for it if the reports are true. So who will Sunak listen to? Meanwhile, former prime minister David Cameron has popped up to