Wednesday, 19 March 2014
Chancellors should beware Budget gimmickry
Today's Budget-time announcement that there is going to be a new UK pound coin may well be justified, given the number of forgeries in circulation. And it's a nice bit of design, looking both modern and classic at the same time. Even so, Chancellors always risk going down in history for the little bit of newsworthy flummery they threw about - rather than their macroeconomic measures. Chancellor Selwyn Lloyd's tenure at No. 11 Downing Street ended in ignominy after the 'sweets and ice cream' budget in 1962, when he raised taxes on sugary treats - and no-one else noticed anything else he did. His Prime Ministerial boss at the time, Harold Macmillan, had already allowed his tenure in the same great office of state to be defined by the introduction of Premium Bonds, a not-inconsiderable idea but undeniably rather small reform that has never exactly set the world on fire.
So Chancellor George Osborne (above) should beware when he announces the new pound , because that's what he's likely to be remembered for.
For what are we offered alongside the new coin? Endless austerity, which is going to get quite a lot worse before it gets better (in 2018, if we're lucky). Probably some more movement on tax thresholds at the lower end of the spectrum - great if you're earning about £20,000 a year, but not so hot if you're on a really low income and the Liberal Democrats' insistence on taking so many people out of tax has already stopped you paying Income Tax altogether. Some middle-class tax breaks for childcare that will help the relatively well-off (and the relatively fertile) more than anyone else. Oh, and the extension of the Government's mad, bad and dangerous Help to Buy scheme all the way to 2020 - only for brand new houses, to be sure, but still a dangerous extra bit of petrol on the flames.
No doubt there'll be some other sweeteners - for instance on infrastructure, which the Coalition should never have cut so hard in the first place, and which they've been running to catch up on since 2012. But on the whole Budgets have the potential to shift votes - usually away from governments, it's true, but they're one of the few political events voters notice. A shiny new bit of gold and silver in your pocket isn't going to shift the polls, which have been moving slightly in the Conservatives' favour, but are still looking pretty static.
The lesson? Fewer gimmicks. More policy.