This was almost certainly the last Budget before Britain leaves the European Union in March 2019 and it was presented under the shadow of Brexit. What the country really needs is a long hard look at our spending priorities and how best to pay for them. In fairness to the Chancellor, five months before we cut loose from the EU is not the time for that sort of radical thinking.
If his options were not already limited by the ongoing negotiations over Britain’s exit from the EU, and the need to keep MPs on side during that difficult process, the Prime Minister’s promise at the Conservative Party conference to draw a line under austerity made sure he was well and truly boxed in.
The widely trailed improvement in the public finances thanks to better tax receipts and lower spending amounted as expected to a £12bn windfall compared with expectations at the Spring Statement. But this had already been spent, and then some, as a result of the Prime Minister’s promise to the NHS.
That meant that this most cautious of Chancellors - one who prefers to do the right thing than deliver an impressive audition for the top job - was always likely to be grudging with his giveaways.
He was, but not in the number of handouts, rather in their scale. The Budget speech lasted a good 15 minutes longer than usual thanks to a very long list of largely inconsequential disbursements. Many of these were hard to disagree with - giving back the expected £10m of VAT on First World War commemorative items, for example - but they will not begin to move the dial in an economy the size of Britain’s.
In other ways, however, the Chancellor is starting to point the economy in the right direction. He has drawn a line under the UK’s largely discredited Private Finance Initiative but is rightly allowing existing contracts to run off rather than paying through the nose to terminate the deals early.
The proposed tax on digital platforms’ UK revenues is an overdue acknowledgement that a handful of mainly US tech giants have for too long been raking it in over here without paying their rightful dues to the taxman. The only criticism might be that a £400m tax take seems rather unambitious given the scale of their businesses in Britain.
The rejuvenation of our High Streets is a desperate imperative, given the speed with which our spending is moving online. Britain has for decades kept residential, retail, industrial and commercial premises apart unlike many continental cities where apartments sit above restaurants and shops in a mixed-use environment that is a pleasure to live and work in. We, by contrast, travel long distances to work and have gap-toothed High Streets as small businesses struggle to pay rent and rates and footfall dwindles.
No-one will argue with a proposed tax on non-recycled plastic - whether packaging or cups.
These are worthy measures but frankly tinkering around the edges. As Mr Hammond knows only too well, anything more meaningful must wait until we know the shape of our departure from the EU and the nature of our relationship thereafter.
As he hinted, next year’s Spring Statement may well have to be another Budget if the terms of our divorce are not favourable.
As for our personal finances, there was little here to concern us. The biggest measure by far was the acceleration of the changes in the personal allowance that determines when we start to pay income tax and the threshold at which higher rate tax kicks in. These will now reach the Government’s target of £12,500 and £50,000 respectively in April 2019, a year earlier than expected. The promise to index them both to inflation thereafter is a bonus, as there had been speculation that freezing these two could be a stealthy way to raise taxes in real terms in future years.
The big fear, as usual before a British Budget these days, was that the Chancellor might finally gird his loins to tackle the ‘eye-wateringly expensive’ pension contribution tax relief that costs the Government £39bn a year and largely benefits higher-rate tax-payers.
In reality, this was never going to be likely so close to a vote on the Brexit deal. The Government can barely scrape together a majority without risking the rage of backbenchers over a much-loved pensions perk.
The Chancellor has been lucky. Growth is better than he thought six months ago, the deficit is falling faster, real wages are rising and likely to continue to do so modestly for the next five years.
But he has played the few decent cards he has been dealt carefully, stretching the little money he found down the back of the sofa as far as he credibly could. And he has used his words just as carefully too. He never risked the claim that austerity had ended - merely that it was coming to an end. That is an important distinction.
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