If Labour knew what it was for today's Budget could be the momentous event Rachel Reeves claims it is going to be. But she has no story to tell, and Keir Starmer stole half her lines in a speech earlier this week. All she's got left is half a plot with a lot of bad news in it.
This is the audio version of this video:
This is the transcript:
What makes an epic budget?
I've been reading about budgets since the 1970s. I've been listening to them since they were first broadcast and watching them since they first appeared on television.
I can remember the excitement of Budget Day when we never knew what was going to happen in advance, and I pored over the Financial Times and other newspapers the day afterwards to find out what actually went on because we did not know in detail because the budget commentary wasn't available for us to analyse on the day, largely because the broadcasts did not take place live.
And now everything, like so much else in life, is very different.
Budgets are leaked massively in advance. We know that Rachel Reeves is going to increase national insurance. We know that there are going to be some announcements about investment. We know that carbon capture and storage is going to feature high on that list, meaning that the whole process will be utterly irrelevant because that is a disaster.
We know that she's going to change the fiscal rules because she's already said so.
We know that, as a consequence, she will claim she has more to spend and that she will say she will do so prudently.
We know that there is actually going to be austerity.
We know which ministries are going to be involved. We know that transport is going to take a hit, as is housing, as, we believe, is environment. Justice is not going to get the money it needs to maintain our system of prevention of crime.
We know that local authorities are also likely to be in the firing line, yet again. And therefore, we are not going to see the investment in social care that we need. We know, therefore, that real people are going to suffer.
And we know that children are on the losing end, yet again, because Rachel Reeves is not going to change the two-child cap. Poverty is, therefore, going to be maintained, as it will be for pensioners.
All of that, we know.
But let's also just think about what we don't know, because that's as important when you come to look at anything.
A long time ago, a very wise person said to me that whenever I read a policy document, I should look for what is not there. Don't worry about what's there; that's what the person wants you to think about. It's what is not there that always matters when you look at something. What is Rachel Reeves, therefore, not going to say in this budget, which she claims will be one of the most momentous Labour budgets of all time? Well, let's find out.
There won't be a story for a start, and without a story, a budget is nothing. There has to be a narrative inside a budget. A budget is a big-picture view of where she wants to take our economy.
As far as we know, she's going to say that she wants to create investment in our economy because she wants growth and let's be clear, investment does help deliver growth, but if you are just going to blandly say you're going to encourage investment without knowing how why where or what, to achieve what outcome, then, frankly, it's a waste of time. You have to have an idea of what you're trying to do.
Let's go back to the 1940s. Labour then knew that it was going to nationalise the railways, the coal industry, transport in general. It was going to look at steel and other industries, which it was going to bring into the public domain.
Why? To provide a strong underpinning for the post-war economy that it wanted to build. Which is why, at the same time. it talked about investment in education, which it did, and investment in public housing, which it did, and investment in healthcare, which it did. There was a really strong narrative.
Is there any such similar narrative now, which tends to come out in the budget above all else? No.
We know that, for example, with regard to healthcare, West Streeting is going to be talking about involvement of private parties.
We know that when we talk about investment, we are talking about things like GB Energy, which is little better than a private equity fund when it comes down to it, which is never going to generate electricity or anything else of its own accord.
We know that there is no coherent plan to the carbon capture and storage strategy because carbon capture and storage is itself not logical because it doesn't work.
We know that there is no story about housing because the amount of spend on that is apparently going to go down in this budget.
We know that there is no story about how to transform society because poverty is being maintained.
There isn't, therefore, at least in advance, any more of a coherent strategy to what Rachel Reeves is saying than there was when people were challenging Labour on giving us a view of where they were going before the July 5th general election.
We didn't know what was going to happen before the general election.
We frankly have no more idea where Labour is going now.
How then can this be an epic budget, the momentous event in Labour history that Rachel Reeves likes to claim it will be? I don't think it can be. Because unless she has suddenly found a story for the modern Labour party which the rest of it is unaware of and which she hasn't previously shared - and I think that's pretty unlikely - then this cannot meet that standard of appraisal.
It is, in fact, much more likely that there will be some kind of disaster inside this budget, which will make it memorable for all the wrong reasons.
There was, for example, the takeaway pasty crisis that followed one of George Osborne's budgets when he tried to change the tax on takeaway food and had to reverse that pretty quickly. It was a disaster because it made him look incompetent.
Philip Hammond tried, when he was Tory Chancellor, to change the tax on self-employed people, and he had to reverse his strategy pretty quickly because it made him look stupid. He hadn't thought through the consequences of what he was doing.
Is it likely that there will be something that comes out of Rachel Reeves' hat on Wednesday which has that same status? Above all else, I think that is the one thing that we can predict from this budget. There will be another black hole into which Rachel Reeves can jump, which she will take the opportunity to do, willingly and without a forethought, because she wants to create disasters because that's all she's managed to do to date.
So I am not confident of this budget. Without a story, without a plan, without a vision, without a direction of travel - and she lacks all those things - I don't see how this can be a momentous budget.
I can see that this will be a budget for the fiddlers, a budget for those who are a little concerned about issues on the side, but there will be no vision for Britain when we need one.
And that's why I am expecting her to fail.
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Your post just about sums it up. I suspect in the future people will look back and say yes it was an epic budget but one that failed to achieve anything useful and led to decline and disaster.
Epic fail, then 🙂
An epic budget makes the most people happy by providing security of food, health, energy and home.
I’d like you to be wrong Richard, and perhaps this budget will have some genuinely good policies within it regarding the future direction of the UK.
I doubt it though. Given this government’s combination of political cowardice, incompetence and intellectual sterility it almost certainly won’t amount to much. How can it when we still have the ‘balancing the books’ beancounter mentality which is apparently going to mean further austerity for some parts of central government and, incredibly, local government?
And if they’re so keen on inward investment we should be talking traversing Brexit which has given us an unprecedented fall in FDI. After all, wasn’t one of the greatest benefits of EU membership that it brought in foreign companies who were willing and able to do the long term investment our own “wonderful” private sector has always been so bad at?
A really transformative government would already have said this, and laid into the Brexiters, stating the fact that they are at best well meaning but deluded and at worst (Gove, Johnson) outright liars.
But no, the coward Starmer point blank refuses to do so because he is scared of the know nothing hysterical loudmouths on the right.
Pathetic and incompetent.
I have always supposed that the purpose of leaking details in advance was to gauge reactions & adjust the final version. With budget speeches, we have also seen significant modification as govt & civil service struggle to turn the ideas into passable legislation. We should allow RReeves to do the same, though I’m not hopeful of the result.
This time it has just been leaking
For good or for ill, this budget is likely to set the tone and the direction of travel for the next four years.
When we look back, after Trump has been president for almost four years and Kemi Badenoch is on the cusp of seizing power, I doubt it will be seen as an epic budget. More likely an epic fail.
Good contextualisation
Thank you, both, and to Richard for the post and readers.
Further to that epic fail coming, let’s add what’s going on in the global south / zone b.
A French economist, Andre Sapir, analysed the BRICS Kazan summit on summit. That and its English translation are doing the rounds in left leaning finance circles. It’s not looking good for the finance capital dominated west. The leftists in finance note, in particular, the stable coin means to avoid the dollar and US sanctions, reinsurance and grain exchange and implied exclusion of rentiers and the US.
It’s staggering how the west continues its sleep walk to disaster and, for Europe, irrelevance.
Let’s not blame it on Trump, either, as per https://www.nakedcapitalism.com/2024/10/big-lies-and-little-progress-biden-national-security-advisor-jake-sullivans-foreign-policy-for-the-middle-class.html. John S Warren and I often refer to Obama’s betrayal of Main Street after 2008. I think 2008 and even going back to the monetarist madness from the late 1970s are still playing out.
I’m glad that the children of my cousins (all in Mauritius) are learning Mandarin, Hindi and even Russian and no longer bothering with German. Most Mauritians speak 3 – 5 languages.
[…] what criteria will I use to assess what she as to say? Using the methodology I outlined in this morning's video, it will be what she does not say that will matter to me as much as what she does say. So, in no […]
The story is of the final nails being hammered into the coffin of that 1940’s covenant and social contract, born out of bloody Wars through the early decades of the last century, that was finally won, by the revolutionary demands of the Many Poor.
That was channeled through the Trad Labour political electoral success story. It raised the poorest and kept the wealth gap sane – removed the Upstairs/Downstairs servility bondage of the aristocrat monarchic theological imperialist tyrannical state that the United Kingdom was created as centuries ago.
The Social Democratic Welfare State Nations.
They are being destroyed.
It has to be a Labour government that gave birth to it that has to be seen to kill it.
The Great Knight Dope and his cabal come not to Raise that from its knees again but to Bury it.
With the Story of guaranteed further Austerity -Tyranny is restored.
Britain is now a sad little country where whichever party its people vote for it’s a version of the British Bankers Party with the possible exception of the Green Party which would probably be worse with an unaccountable quango to decide how much money both the government and licenced banks should be allowed to create in any given period.
Maybe this is an epic budget for the Labour party because they are once and for all going to fully embrace Thatcherism? Maybe this is the tipping point budget for Blue Labour? The Labour party now occupying the Tory party’s place who have now gone much further to the right – a sort of gonzo far right that we are seeing in the U.S.
The thing is, although Laboured thinks they are being really clever by wearing the Tories old clothes, they don’t seem to realise that those old clothes are well…..old clothes, out of date and they don’t work. An old broom is an old broom. Not a new one – even with new faces.
Blue Labour thinks it can hold that ground (it worked for the Tories they argue, so it will work for us) – but it is built on sand on a tidal beach.
Richard is right. It will all end in tears. Another 4-5 years wasted. If they get that far.
I think it will end in tears by next week
The backlash on employer’s NIC is going to be furious
Where will the crunch point be? Nursery care. An increase in employer’s NIC + an increase in the minimum wage, which most young carers are paid, will lead straight into price increases that few young families already hit by staggering rent or mortgae rises will not be able to afford.
I am not saying a rise in minimum wage is not needed. But to pile employment taxes onto young low paid employees meeting social need is crazy – and Labour has not for a moment thought this through.
There will be no narrative above bland statements; 100% agree Richard.
If I can just nick a bit of your post:
“We know which ministries are going to be involved. We know that transport is going to *GET MORE FUNDING*, as is housing, as, we believe, is environment. Justice is *GOING* to get the money it needs to maintain our system of prevention of crime.
We know that local authorities are also likely to be *GETTING MORE FUNDING*. And therefore, we are *GOING* to see the investment in social care that we need. We know, therefore, that real people are *NOT* going to suffer.
And we know that children are *WINNING*, because Rachel Reeves is *GOING* to change the two-child cap. Poverty is, therefore, going to be *REDUCED*, as it will be for pensioners.
I think that would make an MOMENTOUS budget
You optimist