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Buckle up for Budget history ride

Budget Day is coming soon – and just don’t forget the black puddings! If that’s got you baffled you need tips on bluffing your way through the Budget. It was Gladstone’s Chancellor Robert Lowe, who elevated sarcasm to an art form, who coined the phrase that a Chancellor’s duties comprised of distributing “a certain amount of misery as fairly as he can.”

Lowe met his match with the match makers of London, his proposed ha’penny tax on packs of ‘lucifer’matches sparking protest, mostly by women workers, which snuffed out the measure in its infancy – leaving Lowe to reduce duties on chicory and coffee, and later even sugar, and reduce the rate of income tax by a penny in the pound. Lowe left on a high … but have any of our chancellors been bang on the money when it comes to fronting it out on Budget Day?

This year we’re likely to see one of the most significant. A pre-General Election Budget which could deliver more than a few extra pennies to the Exchequer. There is something quintessentially British about Budget Day – to be chancellor of the exchequer is to walk in the footsteps of giants … Gladstone, Disraeli, Lloyd George, Churchill … pretty much with a blindfold on and while negotiating a minefield.

Denis Healey, chancellor in 1974, who served five years under two Prime Ministers, claimed it gave him shingles – often associated with stress. Nigel Lawson (1983-89) dropped the top rate of tax from 60 per cent to 40 per cent – and chose to ignore Margaret Thatcher’s suggestion that 50 per cent would be more acceptable to higher league tax payers. With the words “I must prevail” the Iron Lady overturned his idea of adopting the European system of fixed exchange rates that preceded the now infamous Euro.

If Healey likened the office to shingles, Norman Lamont likened it to term in a “Russian psychiatric hospital” - and it’s worth noting that one of his advisers was David Cameron. His bubble burst with Black Wednesday, September 6 1992, when anything that could go wrong did go wrong and catastrophically, economically, with millions lost as foreign exchange market interest rates leapt from 10 per cent to 15 per cent in a matter of hours.

Lamont blamed it on: “a housing bubble, a credit bubble, financial innovation, too much leverage in the banking system, people unloading assets off-balance sheet”. The chancellors’ chancellor , if not the people’s chancellor, is widely reputed to have been Geoffrey Howe, a key figure in the post-war economy who increased VAT from eight per cent to 15 per cent … and who also announced that benefits to families who went on strike would be cut by £12 a week and taxed. With unemployment close on three million he increased national insurance, housing rents and prescription charges to bridge the dole gap.

He blamed reckless and feckless accumulation of debt for the crisis. Avuncular Kenneth Clark called his term of office ‘tin hat time’. No wonder. Having fought the election on the promise of tax cuts he introduced the biggest tax rises and curbs on public spending seen in almost 20 years in response to the deficit. He’s also widely reputed to have had the greatest influence upon the fiscal policies of one young master Osborne -and David Cameron.

Which brings us back to black puddings - and that box. The definitive red Budget case first used by Gladstone in 1860 took centre stage in the Commons every Budget day until 1965 when Jim Callaghan broke with tradition. It would be 32 years later before another Labour chancellor used yet another new box for the Budget, this time made in yellow pine by trainees at a ship and submarine dockyward in Fife. Gordon Brown’s turf. The original case, its key long lost, was briefly revived by Alistair Darling and, later, Osborne before being pensioned off.

.As for the black puddings? It’s all in the bag … because the notion of using a red case for significant occasions was said to have started in the Elizabethan age when one of the Queen’s courtiers presented the Spanish ambassador with a special red case filled with black puddings.

This was posted in Bdaily's Members' News section by Jacqui Morley .