I will be doing the Budget commentary on Radio 2 on Wednesday this week, beginning at about 13.30 on wherever you usually listen to Jeremy Vine. I’ve been doing this for more than a decade now - and suspect that’s more than 20 broadcasts given how many budgets and similar statements we have had in some years. I have, invariably, been accompanied by Mark Littlewood of the Institute for Economic Affairs in more recent years. As far as I can recall we have never agreed yet on anything of substance.
The pressure to deliver credible commentary to an audience of about 7 million minutes after the Chancellor has sat down without having a chance to see any of the documentation that’s published at that moment is high. As a result in the week or so before the budget I do inevitably look for clues as to what will happen.
We know about national insurance increases, of course. Bizarrely, Sunak claimed this was progressive yesterday, which is utter nonsense.
We know that at present this is going to the NHS - where it is inadequate to meet need. We know social care should get funds, but will not as yet. So there is the first fail.
We also know there are other new small spending plans. There is a half-hearted relaunch of SureStart. The last training scheme from the Tories is being relaunched, although the last one failed. The green saving account is a decided damp squib because of the rate and terms. Environment spend is inconsequential in proportion to the problem.
There is at least £7 billion of spending on public transport. However, we now know that £5.5 billion of this had been previously announced. All we really know that is very new is who is to get the money.
Add it all up and £26 billion of supposed spending - much of it not new - does not come to much when set against need.
No one is speaking of tax cuts. If there are to be any it will be in areas that will excite Tories. My outside bet is on inheritance tax. Maybe a cut to 35% with a promise of more to come? That’s always a crowd pleaser and boosts Tory support when nothing else can - as George Osborne found to Ed Miliband’s cost.
None of this, however, seems like the real story to me. What seems like the real story has I think emerged from my thinking on past budgets that I have commented on. The one I am most especially rethinking of was on March 11 2020. Sunak - then fresh in office - stood up and said he was going to spend £60 billion (as I recall) to tackle the coronavirus crisis. Jeremy Vine’s opening question to me suggested that I must surely be happy with that spending plan and my reply was that Sunak had massively underestimated the scale of the crisis that we were facing and his reaction was far too small.
That is how I feel now. The overwhelming message from this government is of denial. Covid is being denied for the third time - unforgivably. As was the case on March 11 2020, wise people know now that the situation is much worse than the government pretends it to be. Sunak claimed yesterday that the available data does not require government action. Very clearly medics and epidemiologists disagree, almost unanimously this time.
If action had been taken when required during the last few weeks - and the time for that has probably passed - we could have avoided another lock down. As it is the likelihood that lockdown will be needed - probably over Christmas, but starting earlier - now seems to be very high. The refusal to support mask wearing, socially distance and work from home will have come at a massive price.
I don’t think we are talking about an economy coming out of Covid any more. I think we are going to be talking about one right in another wave now.
I think furlough will have to be back on the cards.
And so too will business support be required, again. Unless, that is, substantial numbers of insolvencies are going to be as tolerated as deaths now are by this government.
As for recovery and an overheating economy, the exact opposite is going to be true. Recession is more likely than anything else at present. Retail sales declines are already suggesting it. The Bank of England should be keeping rates firmly nailed to the floor. And reversing QE will just be a dream: I now anticipate more happening instead.
This was not necessary if course. The case of our European partners shows that. But there protective measures stayed in place. Here they did not. Boosterism held sway.
It took just 12 days for Sunak to have to return to the Dispatch BoX in March 2020. I am not sure it will be quite that quick this time. But equality, it may not be a lot longer. We’re heading for crisis yet again and the Budget we’re about to get will offer no hint of that. That means it will be a fantasy budget for a situation that does not exist and likely never will. The real show will be later as the Covid crisis becomes very real, again.
Can a Chancellor survive seeing his budget collapse yet again? I am really not sure, but for one thing, that is. That one thing is Labour’s continuing failure to oppose this government.