Some thoughts on the Budget

I'm not going to write a lot about yesterday's budget because apart from anything else I've not really looked at the detail but there are one or two random thoughts I want to record. So here goes:

• Bearing in mind that Gordon Brown was Chancellor for the first ten years of the 'New Labour' administration and that he is a control freak I can't help thinking that he had a lot of input into this budget. Sure much of it is Alistair Darling's work but because of Brown's previous position I think he, Brown, will have had his fingerprints on some of the decisions.
• The Budget predictions for a rapid return to growth have certainly raised a few eyebrows. When one remembers the simply colossal revision that has had to be made by Darling of his figures in the pre-budget report, projections only five months old, then it is easy to see why nobody is giving the latest figures any credence. I would like to share Darling's optimism but can't; of course if the recovery is slower than he anticipates then there will be more borrowing / more tax hikes / cuts in spending.
• One of the cleverest taxes that Gordon Brown brought in - it was some years ago now but I can't remember just when - was a 5% tax on insurance premiums. I have a feeling that quite a few people may not even register the fact that it exists. It surprises me that no attempt was made to increase the rate yesterday (or perhaps it has been for all I know) because this is a tax that is relatively painless and as so many people pay for their insurances on a monthly basis it is one of those government sources of income that comes in on a very regular basis.
• Car scrapping scheme. Instinctively I dislike this idea. One country that has been mentioned having a similar scheme (apparently successful) is Germany. First thing to note is that we are not Germany, it is always dangerous to assume that what works in one country can be applied to another. Briefly then if one has owned a 10 year old car in the UK for at least a year it will be possible to have that car scrapped and then purchase a new car at £2000 off its purchase price. Of this £2000 half will be stumped up by the government, you and me in other words, whilst the other £1000 will come from the motor industry. I think that the Treasury have earmarked enough money for 300,000 new cars to be bought using this scheme. Now I don't know about other parts of the country but in Cornwall I can't imagine very many people being able to go from a 10 year old 'banger' to a brand new car even with this £2000 discount. It's the supposed environmental plus of having a new car that really gets to me though. Yes of course technology has moved on and we now have 'greener' cars but no mention is ever made of the environmental cost of making a new car which is much greater than that of the repairs / servicing of the older model. It seems so wrong to me to remove a serviceable but elderly car from the roads just to appease the motor industry. I do have my doubts about the practicalities of the scheme and will be very interested in seeing the extent of any take up.
  

Brown, the other Chancellor

Alistair Darling is Chancellor of the Exchequer, at least in name. The question is this: how many of the economic policies, seemingly made on the hoof, are his and how many are originating from his neighbour, one G Brown. The relationship between Prime Minister and Chancellor can become quite fraught as ultimately happened with Thatcher and Lawson. Remember that Brown was Chancellor for ten years and that he is obsessed with micro managing everything. I just can't see him agreeing to Darling being the sole person in charge of the economy and I do wonder just how many initiatives in the current financial crisis are originating in 10 Downing Street rather than number 11.

Darling made a very frank comment at the end of last summer stating that our economy was in the worst position it had been in for 60 years and that the downturn would be longer lasting than expected. Contrast that with Brown who has spoken about the UK being best placed to weather the downturn. Now I can understand a PM trying to avoid talking down the economy but Brown's denial of reality is in his DNA. One of Darling's attributes is his loyalty to the cause and to other people but come the next budget he will be the recipient of a huge amount of flak as he dramatically has to turn the treasury forecasts on their head. Will he be willing to continue absorbing the criticism that will come if in fact it is Brown who is primarily responsible for driving the ill thought out policies of the moment. Darling is normally calm and polite but will there come a moment when he cries "Enough is enough" if in fact it is Brown who is continuing to invent the present muddled economic policies. Are Darling and Brown totally in accord then over these policies or is it the case that the sombre faced Chancellor is really thinking " some of the things we are doing are rubbish but I must be loyal to Gordon".

Missed the 2008 budget

So yesterday we had Alistair Darling's first budget. I have to say that on this occasion I didn't watch it, my excuse being that I genuinely had to be somewhere else at the time. But even if I had been in I'm not sure that I would have bothered to view it or listen on the radio. In the good old days of budgets there used to be a bit of fizz about them. Latterly we have had years of Gordon Brown delivering a cascade of statistics whilst repeatedly inferring that wasn't he a clever so and so in the running of the economy. There's been much comment about Darling's lacklustre style; I think Gordon Brown is happy with that because of the squeeze on the economy and lack of genuine good news: he wants to move on quickly from the decisions of this year's budget.

Because there wasn't scope for any decent handouts by Darling then it was easy for the opposition leaders to go after him. It used to be standard practice for the best bits to be kept to the very end so that the leader of the opposition could be wrong footed, the last mentioned really had to think on their feet and at great speed when the last two sentences of the Chancellor's speech might be say ... "From April the standard rate of income tax will be reduced by 2p in the pound. I commend this budget to the House" (Much waving of order papers on the government benches).

The thing that really gets me though is the deliberate slipping out of information prior to the event. In this instance the day before the budget the decision to postpone the hike of 2p in fuel tax was out in the public arena. I assume the idea was to get the motoring public in a reasonable frame of mind early to mitigate the sharp increases in road fund licence announced the following day. But it's the MPs in the House who should be informed first. It's interesting to note that another Labour Chancellor, Hugh Dalton, resigned after the 1947 budget when he let slip some information to a journalist prior to his speech. I believe very strongly that if you are making a speech to a group of people be they MPs, captains of industry, union leaders, whoever then those particular audiences should be the first to know what the orator says. These days it appears to be common practice for a precis of the subject matter to be trailed earlier so that for instance the 'Today' programme can discuss it before the audience has heard it! I find this to be grossly disrespectful to those who are going to listen to the speech.

I don't know how recently this process started but I feel it is another manifestation of the lowered standards of public life.