John Healey has delivered his first Budget as Chancellor under Andy Burnham's government, and after reflecting on what he said, I have reached a depressing conclusion: this was a Budget that did almost nothing to address Britain's economic problems.
In this video, recorded in a London café just hours after the Chancellor's statement, I explain why I believe the Budget represents a serious failure of political and economic leadership.
Despite the enormous challenges facing Britain, John Healey announced very little that will make a meaningful difference to ordinary people's lives.
There were some limited measures intended to reduce household energy costs, including changes to standing charges, an extension of electricity VAT relief and a £100 rebate for millions of households.
But these measures must be considered against the much larger increases in energy bills that households could face in 2027.
With oil and gas prices rising because of the war involving the United States, Israel and Iran, I fear that these modest reductions will be overwhelmed by further increases in household costs.
The Chancellor also announced changes to bank taxation, but I argue that he missed a much bigger opportunity.
The government continues to pay substantial interest on commercial bank reserves created through monetary operations associated with the financial crises of 2008 and 2020.
I have repeatedly argued that reforming these arrangements could save the government around £20 billion a year. Yet the Chancellor has done nothing to address this issue.
Instead, we have been presented with a Budget that leaves the underlying problems of Britain's economy untouched.
And that raises a much bigger political question.
What is the point of having a new Prime Minister and Chancellor if neither is prepared to deliver meaningful change?
Andy Burnham's government had an opportunity to demonstrate a new direction for Britain. Instead, I believe it has shown that it remains trapped within the same neoliberal economic thinking that has dominated British politics for decades.
The Conservatives, Labour and Liberal Democrats have all operated within an economic framework that prioritises financial markets, austerity and limited government intervention.
I argue that this political consensus has failed.
Britain needs something fundamentally different: an economic system that puts people's needs first, recognises the government's capacity to act and offers genuine hope for the future.
Modern Monetary Theory provides a framework for understanding how government can mobilise the resources needed to deliver better public services, greater economic security and meaningful investment.
What Britain needs now is an economics of hope and a politics of care.
This Budget did not deliver either.
But perhaps its failure will help demonstrate why fundamental political and economic change is now essential.
The audio version is availble here:
There is no transcript for this video. We just ran out of time. Sorry. It was a long day.
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Going from your previous video based on the data collected for Asda Labour, Conservative and Lib Dems are choosing to prioritise the wants of the top 40% of the population over the needs of the bottom 60% which, with things going as they are, is set to become 65% and then 70%. Not a winning strategy I would say.
And I would agree – especially as they are inclining fascist as a result.
Giving each household £100 is a ‘gesture’. It is not any form of relief at all.
Firstly, as alluded here, they seem to be storing up the ‘real help’ for an election bid. That is party politics before the people and frankly unacceptable.
Secondly they have created yet another vulnerability over the ‘welfare’ bill – the Tories and Reform will say that cuts could have been made there and they will use this to stoke up resentment (Labour MPs openly acknowledge that it is ‘too high’). I think Burnham will use this reaction to make deeper populist cuts to social security next time – he has carried out a sort of straw poll on these measures and it is the behaviour similar to Pontius Pilate – another ‘administrator’ and ‘non-leader’ from history.
I had to agree prima facie with what Ed Davey and even Farage said – but really they were getting at the social security bill as well I think, so there was no moral outrage, just I think the belief that the people of this country who have been made increasingly ill and discombobulated by austerity and bad management had gone ‘soft’.
Fully agree with your post. It was a case of ‘Here’s £100 now piss off and come back later when we’ve worked out more as to how we can turn this to the party’s advantage’.
Well, it works both ways. I will not vote for you, not even recognise your MPs Andy. End of. Labour has ceased to exist for me. Yesterday proved it.
Thanks for all your hard work and especially yesterday. Healey’s budget was a complete non-event. The best that I can say is that it was a “going through the motions” budget because a General Election is on the horizon. However, given the number of times Burnham has publicly denied that he will call such an election, if I am correct it will erode what little remains of public trust in politicians. Have they not reflected on recent events in France, Spain, Italy, Portugal and Albania? And to think these political clueless non-entities are in charge in an age of growing global conflict, climate breakdown and an AI “boom” that will either lead to mass unemployment (e.g. Microsoft) or a Stock Market crash. I seemed to recall Healey saying some clap trap about making life easier for those promoting data centres although I may have dreamed that because I was dozing off as a result of his soporific delivery. One other, more sinister explanation might be that those in power expect political and social collapse and for it to happen soon so the budget was simply to bide time until the collapse happens which will then give them the opportunity to introduce a wide range of draconian authoritarian measures. I despair. The only positive action that I can see is to make it clear that I will stay with the Greens and will not be this LINO party. Polanski is already on the receiving end of the same establishment treatment visited on Corbyn. It will, however, be necessary to hold his feet to the MMT fire and also to prevent a Labour Together infiltration of the Green Party. All in all, not a reason to be cheerful.
” I seemed to recall Healey saying some clap trap about making life easier for those promoting data centres although I may have dreamed that because I was dozing off as a result of his soporific delivery.”
He did that.
He even promised them their own right to build their own power stations in the green belt, as the national grid is so crap.
There is going to be a lot of friction over this.
I did not notice that bit – I must have dozed off by then. If he does this it won’t be just the peasants in the countryside that will revolt, as Trump is learning to his cost. Even Republican voters have had enough of the tech bros and their rapacious data centres. Vive la revolution!
People the barricades
I note what you say on the Greens.
They are now an MMT party. An economic policy I heavily influenced has now been adopted by them.