Budget21

Last week Rishi Sunak presented his second Budget to the House of Commons. Today, three former Chancellors weighed in. Speaking at an online event hosted by the Institute for Government, Norman Lamont, Alistair Darling and George Osborne joined the Institute’s director Bronwen Maddox to discuss the state of the UK economy, and how their past experiences lead them to reflect on recent events. There was a surprising amount of consensus from the panel – not on the best way to handle or manage the economy, but about what is politically possible. Fuel duty came up multiple times as an area of policy that doesn’t gel with the government’s stated commitments

Keir Starmer has caught a lot of flak this week for his response to the Budget. The complaints are that he wasn’t strong enough, his opposition to corporation tax rises was a mistake and that he had nothing to really say that managed to stick with the public. It has added to a sense of Starmer’s leadership of the Labour party being on a downward spiral. Yet Starmer has probably done as well in his opening year as Labour leader as anyone could have. He isn’t the problem – it’s his party. The reality is that Labour couldn’t win the next election with anyone in charge. The problem goes well beyond

Rishi Sunak’s budget appeared to offer some good news to Scots, not that the SNP saw it that way. An additional £1.2 billion in Barnett funding was handed over to Scotland’s government. This is on top of £9.7 billion in extra spending delivered over the past year for pandemic support. But the SNP Scottish government took a different view. ‘While I welcome some of the announcements today, it is clear the Chancellor has not matched Scotland’s ambition for economic recovery and supporting households,’ said Scottish Finance Secretary Kate Forbes. Forbes and her colleagues often point out that ‘Scotland’s ambition’ includes more borrowing powers. Throughout the pandemic, the SNP has been at

Ask voters what the most important issue facing Britain is and just 2 per cent say immigration. Even when you expand it to the most important issues, the figure only reaches 6 per cent. This is a dramatic turnaround from 2015 when 56 per cent listed immigration as one of the top issues facing the country. In my Times column today, I ask what explains this shift. The end of free movement and the resumption of border control has taken much of the heat out of the issue In part, it is Covid. Before the pandemic, net migration to Britain was running at 313,000. In the past year, though, hundreds

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

The Chancellor’s crisis management has been excellent. The Budget was another reflection of that, as Rishi Sunak unveiled further significant, targeted support to the areas of the economy that needed it most. Over the last year, fiscal policy has acted as the main shock absorber for the economy. Including measures announced today, a massive £352 billion has been spent on Covid support. This approach has been fully justified, with low inflation, rates and yields providing ample fiscal space. Debt dynamics have allowed the government to borrow cheaply from investors. Also, as we have seen over the last year, the Bank of England’s Quantitative Easing programme has led it to become