Do Sunak’s sums add up?

Rishi Sunak will need to raise taxes or cut spending by £15 billion in order to tame national debt by 2025, the Resolution Foundation think tank has warned.

Although Tory MPs cheered Sunak at a private meeting following his appearance in the House of Commons yesterday, economists have been expressing their doubts about his Budget as the dust settles. Assessments by the Institute for Fiscal Studies and the government’s own Office for Budget Responsibility are in line with the Resolution Foundation’s; the government would have to spend or tax considerably more than its own estimates suggest to make the sums add up.

“The Chancellor isn’t really levelling with people on the choices he’s making,” said Paul Johnson, the IFS director. “By the end of the forecast period we are looking at a fiscal tightening of over £30 billion relative to previous plans. Take account of the cuts to planned spending announced in the autumn and Santa Sunak, purveyor of billions today, looks more like Scrooge Sunak, cutting spending and raising taxes to the tune of nearly £50 billion relative to his pre-pandemic plans of March 2020.”

Sunak’s honeymoon with the press may be coming to an end. “Sunak’s five-year tax grab”, “Rishi’s Masked Tax Raid”, and “Highest tax levels for 50 years” ran the Telegraph, Mail, and Times today, focusing on Sunak’s plans to raise taxes to the highest level since Labour’s Roy Jenkins was Chancellor. Rachel Wolf – the author of the 2019 Conservative manifesto – has said that the Tories are moving away from the traditional low tax/low spend ethos.

The Budget seems to have gone down far better with the public. A snap Yougov poll shows the Tories have opened a whopping 13-point lead over Labour, up four points from a week ago.

And despite the furore, the odds of Sunak becoming the next prime minister have jumped from 21 per cent to 29 per cent in 24 hours. Coke addict or not, the Chancellor seems to be riding high.

Myanmar protesters undeterred

Myanmar’s pro-democracy demonstrators are on the streets once again, undeterred by yesterday’s crackdown – the bloodiest day of unrest since the coup began.

Thousands gathered in Mandalay today chanting anti-coup slogans, and mourning the death of a 19-year-old woman, known as Angel, who was shot in the head yesterday when the military opened fire on crowds. Thirty-seven other demonstrators were killed across the country. Video clips are surfacing, showing police beating up an unarmed volunteer medical
crew.

The military justified seizing power on 1 February by alleging fraud in November’s general election, which saw Suu Kyi’s National League for Democracy party win a landslide victory. It’s provided no proof of any irregularities.

The ousted 75-year-old leader has been held incommunicado since the coup began but was seen for the first time earlier this week when she appeared in court via video link.

World powers are viewing Myanmar’s crisis with growing unease. Sanctions are being considered by a number of Western countries, including the US. And the UK has called for a UN Security Council meeting tomorrow to discuss the worsening situation. Human Rights Watch is demanding the UN impose a global arms embargo against the Myanmar military.

Italy blocks Oz jabs

Italy has become the first EU country to impose an export ban on coronavirus vaccines after it blocked a shipment of 250,000 AstraZeneca jabs destined for Australia.

Rome notified the European Commission which signed off on the blockade as part of its vaccine export transparency scheme, under which EU-based vaccine-makers must ask national authorities in the country of production and the Commission for permission to export outside the bloc.

The scheme has prompted fury from a host of experts and EU allies, who believe it represents a dangerous precedent to full-blown vaccine nationalism.

The supply issues hampering the EU’s vaccination programme have prompted Italy to follow in the footsteps of France and Spain, and give previously infected people a single vaccine dose rather than two.

The export ban on AstraZeneca shipments outside the bloc is not expected to impact Britain because of the two domestic factories already producing the jab.

Mattie Brignal,
News Editor