Budget: Out of the frying pan and into the fire

It was arguably over before it began, writes Bdaily editor Steven Hugill.

The leaking of the Office for Budget Responsibility’s growth forecast only served to pour a further ladle of fat into a political frying pan that had been spitting furiously for weeks.

Ironic, then, that the Chancellor’s autumn budget speech – rendered somewhat redundant by the embarrassing gaffe – came with a promise to smear a good slab of antiseptic cream on a country left burned and blistered.

For a Government still tending wounds from previous policy scalding, its potency must work. And fast.

As she stood at the despatch box, the Chancellor was keen to stress the ‘choices’ she was making, which she said would eschew “austerity and reckless borrowing (in favour of) cutting tax, waiting lists and the cost of living”.

She also appealed for the country’s populace to ‘make a contribution’, a rather brave request to people left soured by previous headline raids on employers’ national insurance and the farming sector, an incredible U-turn on welfare cuts and the downgrading of UK economic growth forecasts.

The Chancellor’s latest pic ‘n’ mix offer certainly came with some sweeteners, notably the expected scrapping of the two-child benefit cap, which promises to reduce the number of children living in poverty by 450,000 in five years’ time, and a rise in the national minimum wage.

For a country whose metaphorical breadline continues to grow longer, it promises much-needed sustenance.

In business, the promise of funding to make training for people under 25 on apprenticeships free for small and medium-sized enterprises is a welcome step.

Under a “build it here and Britain will back you” pledge, the Chancellor also vowed to increase venture capital trust and enterprise investment scheme limits, which hold great potential to fire further innovation and risk-taking.

And additional policies, including a commitment to spend £16 million on a STEM centre in Darlington, are to be commended too.

But, as with all policy plans, with one hand giveth, the other taketh away, and the – longer than expected – freeze on income tax thresholds, restrictions to pension salary sacrifice legislation agreements and a rise in dividend and savings tax create a nervous environment for workers, employers (again) savers and investors.

Nervous too are drivers of battery electric and plug-in hybrid vehicles, who face a new mileage-based charge from 2028.

The Chancellor set a bullish tone, goading heckling MPs opposite to continue their barbs, a world away from the cowed, curbed figure of recent times.

I interviewed her a year ago, when a Westminster public relations 101 tour arrived in Wearside.

At first, she reverted to political type, her answers coming straight from the Labour communications office.

But when I questioned the Chancellor on the Government’s support for County Durham-based trainbuilder Hitachi – at the time raising serious concerns over a lack of fresh orders – she changed.

Mention of ex-Sedgefield Labour MP Phil Wilson – who played a crucial bridging role in uniting the principal political parties to help lure the Japanese firm to the cradle of the railway – brought an altogether different side.

Here was the Chatty Chancellor, smiling and joking her way through the rest of the interview.

That demeanour softened the moment, but it’s going to take much more to soften the stakes – and reduce the anger – raised so high over the last year.

This budget won’t be judged on its applause lines, but on whether it cools a country still blistered by stagnation.

If the promises bite, confidence may begin to regrow.

But if they don’t, and the heat intensifies, then the fires that rage may well be politically terminal for the Chatty Chancellor and all.

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