There is one month to go before Sajid Javid delivers his first budget and, if you hadn’t noticed, recent events should have been a reminder. It is tradition that policy ideas float out of government and settle on newspaper pages in the build-up, though it wasn’t always so. In 1947, a budget leak did for Hugh Dalton as chancellor. These days, the chancellor likes to dip his toe in the water before taking the plunge. In recent days, we’ve had rumours of a mansion tax, pensions’ tax relief reform, a cut to entrepreneurs’ relief and subsidies on insulation and electric vehicles to help people to green up their lives. Part of this is about positioning. No Tory chancellor would introduce a mansion tax unless their goal was career suicide. For the party’s new “red wall” voters, though, the idea that it might level down the London rich while levelling up the northern poor would play well. No one likes Londoners, after all, as the pollsters at YouGov found. If the government is lining its ducks up early, it is because March 11 should be memorable — not least because last year was the first in two centuries that there was no budget. Mr Javid has to triangulate three issues: levelling up by investing £100 billion in the regions over five years; leading by example on carbon emissions to make the COP 26 climate conference in Glasgow a success; and keeping a lid on the public finances. For COP26 to be a success — if the prime minister is to convince China and India to raise their carbon ambitions — he will need to lead by example. Raising the carbon price floor to at least £30 a tonne, staggered from 2021, would raise £1 billion and secure him the moral high ground. If he let fuel duty rise in line with inflation, after an eight-year freeze, he would bag £1 billion and avoid cries of hypocrisy. Next month could be very interesting.
Times 11th Feb 2020 read more »