Budget Briefcase
Budget Briefcase

Budget day is an incredibly important part of our political calendar. Yes, it’s about finding out how much tax you’ll be paying, about economic policy, and the latest data on our government’s finances.

And there’s a really important constitutional point to it too. This is the moment when parliament grants government the money it needs to spend to keep our country running. We hear a lot about the sovereignty of parliament, and this is it at its most fundamental. If government can’t convince parliament to grant it the money, then the government will fall.

This partly explains why today’s Budget was such a mess. Because no party can command a working majority, all it would take is 7 Tory MP’s to vote against the Budget and it’s game-over for the entire government. So what was Philip Hammond’s response? To spread a little money very, very thinly indeed. That’s because he had to please every group of MP’s that came to see him demanding more money!

That’s why we had an announcement, to great cheers, of extra money for people living with disabilities. But it works out at £4 each. Schools are to get a ‘record boost’. But in fact the most any school with get is £15,000 (think how far that will go in one of our local schools that has water coming through the roof when it rains). The disastrous Universal Credit will get an extra £1.7 billion, but this is less than the £2 billion than George Osbourne took out of the budget four years ago causing Iain Duncan-Smith to resign.

I called on the chancellor to announce a wholesale review of the way we tax companies. Global digital companies are exploiting the lack of physical presence in our communities to sell products cheaper, which is great for us consumers, but it puts our retailers at a terrible disadvantage. Shops should be celebrated for the contribution they make to our communities, not penalised.

The Budget has given some relief for small shop owners in their business rates. This isn’t enough, doesn’t benefit a huge number of retailers, and is tinkering with the system rather than changing it. At the other end he’s announced a new ‘digital tax’ that will raise a paltry £400m collectively from the world’s biggest tech companies like Google, Amazon, and Facebook, in three years time.

Lets put that in perspective. Debenhams, a historic presence on our high street and in deep trouble now, paid £85m in business rates last year alone. It’s an insult to retailers that digital companies will be expected to contribute so little in comparison. Sainsbury’s alone pays £580m in business rates every year, a staggering £180m more than every digital company in Britain combined will be asked to pay in this new tax.

Brexit was barely mentioned and we all know why – he was trying to make his last Budget a cheery affair. But he slipped out that another £2bn (four times than the extra spent on schools, and double the extra money for defence) is going to be made available to ‘stabilise the economy’ at the time of Brexit. And that the routine ‘spring statement’ in the New Year is on standby to be converted to an emergency Budget. Gives you confidence, doesn’t it!

And think about what wasn’t mentioned. The Tories used to be the party of law and order. No more. In an era where draconian cuts to police staff and budgets have led to record increases in violent and knife crime, Philip Hammond didn’t mention policing, crime, courts or justice once in his eighty minute speech. This, for me, is unforgivable.

I know most people hate heckling in the Commons, but sometimes a heckle sum things up pretty well like today when Philip Hammond said ‘I will bring this new measure in in two years time’. The plaintive voice of amazing Paula Sherriff (MP for Dewsbury) cut through…”but you won’t be here then”.

Paula summed it up. This Budget was about getting the government through another painful week, not about transforming our economy or marching forward with confidence.

Taken as a whole, this Budget simply does not add up to the scale of challenge our economy faces. It will not be remembered for anything other than Philip Hammond’s last as chancellor and Theresa May’s as prime minister.

My only hint of optimism in a dire afternoon was at the end when the chancellor sat down, several dozen women born in the 1950’s leapt to their feet in the public gallery at the fate of their state pensions. The ‘WASPI Women’ have been callously treated by this government. It was a strange sight in the chamber because they were behind sound-proof glass so for us it was like watching a silent disco going on up there. But believe me, I knew what they were saying loud and clear!

Please let me know what you thought of today’s budget. I know it affects people in different ways and I always learn so much from your comments. All the best, Peter

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