Even before Wednesday’s Budget, the pork barrel is very much in evidence in this General Election campaign. Energy prices frozen, tuition fees slashed, pensioner bonds and even an extra ten minutes at the parking meter. Don’t look for any great themes this time around, the politicians are appealing to your wallet and purse.
The Budget will be dominated by this thinking. George Osborne spends as much time in the Downing Street election strategy room as he does at the Exchequer. He is a highly political Chancellor and will want to use this last Budget of the parliament to bribe the voters and disguise what will come after if he’s still in charge.
As the Institute for Fiscal Studies reminds us the first year after each of the last five General Elections has seen net tax rises of over £5bn per year in today’s terms. It will be no different in 2016. Debt is set to peak at 80% of national income. The deficit is 5% of national income. Remember that as George delivers his good news vibes on Wednesday.
The problem for Labour is that the general economic mood is more optimistic. There is a widespread belief that the Coalition has turned the economy around. Unemployment is down, investment is up and here in the North the Chancellor is pushing the Northern Powerhouse. He may have more to say on that next week. Let’s hope there’s something in there for Leeds, Liverpool and Preston after the super serving of Manchester with money and powers.
So what can we expect in the Chancellor’s sixth budget? The headline grabber could be £11,000 as a starting rate for income tax instead of the planned £10,600. This would have the support of the Lib Dems who’s policy this is. It would save basic rate tax payers £160 a year. For all his Etonian background, Mr Osborne knows the working man likes a pint. Expect 2p off beer and a cut in the rate on scotch, although that is unlikely to stop 40 SNP members in the next parliament. The Chancellor would catch the public mood by measures to crack down on multinationals who don’t pay their taxes in Britain.
Wednesday’s budget will be a challenge for Labour at a time when there are signs that the traditional pre election surge that governments get is beginning to show. The polls have been stuck for months showing Labour and Tories expecting to get about 285 MPs each. Newsnight’s pollsters now have the Tories on 295 and Labour on 267.
Shadow Chancellor Ed Balls has made blood curdling prophesies that the Tories would make £70bn cuts after the election. He is exaggerating and we need to remember Labour would be cutting public spending too. But Balls is right to focus on the grim years ahead for all departments that are not ring fenced, particularly local government. Remember that when Osborne speaks next week.
CONSTITUENCY FOCUS: CHEADLE.
This seat will test the Lib Dems hope that they can defy their dire poll ratings where a hard working incumbent is facing a challenge from the Tories, not Labour.
Mark Hunter has been the Lib Dem MP for Cheadle since a by election in 2005. He held it last time with a majority of 3272. The seat has a history of Liberal support going back to the days of the Granada TV doctor Michael Winstanley.
It is an indictment of the Tories who should perform better in a seat which is the most socially upmarket in Greater Manchester. Hoping to restore Tory fortunes is former South Ribble Conservative councillor Mary Robinson.