Summer budget 2015

One-nation economics

In his hastily scripted victory speech, David Cameron hit upon a mission that he wanted to define his remaining years in office. ‘I want my party, and I hope the government I would like to lead, to reclaim a mantle that we should never have lost: the mantle of one nation,’ he said. The problem was obvious: how could he reconcile this phrase with the hideous financial decisions that he had to make in office? With having to decimate not just unemployment benefits, but the support given to the millions trapped in low pay? George Osborne started to give his answer with his Budget this week. His main decision was

The IFS’s verdict on George Osborne’s ‘deeply disappointing’ Budget

In the March Budget – and, indeed in the Conservative manifesto – we were promised budget balance by 2018-19. That magic moment has now been shifted back a year. In part, that reflects a gentler than planned path for spending cuts, including welfare spending cuts. The gentler path does not however represent a let up in the overall scale of cuts – other than for defence. Spending in unprotected departments (those other than health, overseas aid, schools and, now, defence) will still have fallen by about a third in real terms over the ten years to April 2020. The Budget was certainly not short on measures. The scorecard shows net

James Forsyth

Osborne’s mission: erase every trace of Brown

To understand George Osborne, it is important to realise that he cut his political teeth at the height of the New Labour ascendancy. He remembers the humiliations that were visited on his party as Tony Blair carried all before him. But there is one moment from that period that Tories can look back on with satisfaction: their opposition to Britain joining the European single currency. In 1998, William Hague warned, in a speech drafted by Osborne, that the euro would become a ‘burning building with no exits’. When this speech was written, Osborne couldn’t have imagined that those flames would be the backdrop to the first Budget of his second

At last, defence has been saved from further cuts

So much has happened in this Budget that it’s easy to overlook one of the most important announcements: that George Osborne will, after all, fit a lock on defence spending to make sure that it stays at 2 per cent of GDP until 2020. The Spectator has been calling for this for some time; I called for it again last week – and, to be honest, more in hope than expectation. But the Chancellor has delivered; his pledge is watertight. The MoD had thought that defence spending (as defined by Nato) was set to slip to 1.85 per cent of GDP within five years – and filling that gap would cost £3.23

Lloyd Evans

What does George Osborne have against the fecund?

Budget leaks were once the cause of scandals, inquiries and resignations. But the contents of George Osborne’s red box were spilled across the papers last Sunday. By yesterday the entire package was old news. Yet Osborne remains addicted to the last-minute surprise. What would it be? Gym membership for Angus Robertson? Free counselling for ousted LibDems? Britain to join the drachma? The living wage – Osborne’s grand revelation – is his attempt to redraw British politics. It aligns the Tories with the working-class against Labour. The opposition wanted a minimum wage of £8 by 2020. Osborne ups that to £9. There are sweeteners for the squeezed middle too. The threshold

James Forsyth

A Budget that refused to sweat the small stuff

What makes this Budget so politically astute is how it all fits together. The four-year freeze on working age benefits and the cuts to tax credits are made palatable by the introduction of a national living wage. Meanwhile businesses’ potential objections to this wage hike will be muted by the cut in corporation tax to 18p and the hypothecation of vehicle excise duty to road improvements. It is hard to define this Budget politically. There were plenty of things in there to please the Tory right, the commitment to spend 2% of GDP on defence in particular. But it was also one that made several raids on Labour territory in areas

Fraser Nelson

Six policies that George Osborne has just stolen from Ed Miliband  

[audioplayer src=”″ title=”Fraser Nelson, James Forsyth and Isabel Hardman discuss the Summer Budget”] Listen [/audioplayer]The morning after the election, Ed Miliband said that his party had lost the election but won the argument. He was mocked for this observation but surveying Osborne’s summer budget, he may have a point. It was cleverly spun: the tax-cut for Middle England trumpeted this morning has turned out to be a run-of-the-mill 1.2pc revision to the 40p threshold, not even in line with earnings. Clever old George. In fact, the first all-Conservative Budget for a generation has seen the Chancellor accept many of Labour’s arguments, moving to the left with a tax-and-spend budget and putting his tanks on the

Fraser Nelson

Budget tricks: is Middle Britain really getting a tax cut?

We learn this morning that George Osborne is planning a tax cut for the middle class, by raising the earnings threshold for the 40p tax. Of course, this was raised automatically in the Labour years (in line with RPI inflation) and even tricksy Gordon Brown never billed it as a tax cut. It’s only a tax cut if the threshold rises faster than average wages (i.e., the green lie above). If the threshold is frozen, or falls at lower rate the average earnings, then it’s a tax rise. This point is often lost on broadcasters, and HM Treasury is in no rush to explain things. So keep your eyes on this:

Summer Budget 2015: Full text of George Osborne’s speech

[audioplayer src=”″ title=”Fraser Nelson, James Forsyth and Isabel Hardman discuss the Summer Budget”] Listen [/audioplayer] Mr Deputy Speaker, This is a Budget that puts security first. It’s a Budget that recognises the hard work and sacrifice of the British people over the past 5 years and says: we will not put that at risk, we have a job to do and we’re here to get on with it. This will be a Budget for working people. A Budget that sets out a plan for Britain for the next 5 years to keep moving us from a low wage, high tax, high welfare economy; to the higher wage, lower tax, lower welfare country we intend

Isabel Hardman

Summer Budget 2015: What we know so far

We know that George Osborne’s first Tory majority Budget is going to be big. It will be far bigger than the announcements that have been briefed so far, that’s for sure. What we know so far is as follows. There will be £12bn of welfare cuts, but they will be implemented over three years, rather than two. Those cuts will take in tax credits, including child tax credit, which is expected to be limited to two children, employment support allowance and housing benefit. And the Independent reports that the Chancellor will also replace student maintenance grants with loans. Fraser explains why the Chancellor has changed his timetable on the welfare

With no coalition partner, George Osborne negotiates himself out of £12bn welfare cut

Let’s face it: George Osborne’s pledge to save £12 billion from welfare over two years was never really credible. He never told us where the savings would come from, and it seemed as if he didn’t really know. So tonight’s news, that the Chancellor has cut this to £8bn and given himself an extra year (or two) to make the full £12bn, is welcome. listen to ‘Nick Robinson: Osborne will soften his £12bn welfare cuts.’ on audioBoom

Isabel Hardman

Tories ‘to slow welfare cuts’ in Budget, reports suggest

Tomorrow’s Budget is expected to be brutal, with the Conservatives recognising that now is the time to inflict the maximum pain as the party is the furthest it will ever be from the next election. But Sky News reports tonight that one of the most-reported aspects of that brutal Budget, the £12bn of welfare cuts, will be introduced a little more gently than expected. Faisal Islam writes that this is ‘partly because buoyant tax revenues and new Office of Budget Responsibility projections mean the Chancellor can meet his fiscal mandate without making the welfare cuts within two years’. It does also mean that a withdrawal of tax credits, for instance,

Fraser Nelson

Five tricks that George Osborne may pull in his Budget tomorrow

It’s Budget day tomorrow, and as James Forsyth put it recently, George Osborne will never have a better time to do bad things. The Labour party is a complete mess, the quality of scrutiny will be pretty ropey. So if he’s going to pull a fast one, now’s the time. Gordon Brown’s budgets were famous for having a lollipop (a goodie, briefed out to the press) and several weasels (nasties, heavily disguised in the small print). Now, Osborne may well be honest about his good and bad news tomorrow. But his Treasury staff, schooled by years of Brown’s shenanigans, may have persuaded him that the best way to deliver bad news is to