Bring back Budget purdah

Jeremy Hunt is a charming chap. He could not have been more polite on the radio last Sunday morning when I asked him for the thinking behind his consideration of moves against non-doms in his budget this week. 

“Adam you are probably the most experienced journalist in Westminster and you know chancellors don’t answer questions on the details of taxes…”

“Thinking is what I was asking about”, I protested. Only to be met with a short lecture on “my approach to tax in general.” 

It is always welcome when senior politicians put themselves up for interview. Since Gordon Brown was in the Treasury, chancellors do it before their statements. So-called Budget “Purdah” is no more.

 I doubt it really works to the benefit of the politicians, the journalists or, most importantly the public. 

These days, government-sanctioned briefings, press releases and interviews have stripped bare major financial statements from the Chancellor before they are delivered in parliament. Any excitement is gone by the time the announcement is made. The news seems stale, even boring, and is quickly set aside, even though there has been no discussion informed by confirmed facts. 

In this week’s cloud of unknowing, all that people are likely to remember is that the Chancellor talked about tax cuts and non-doms even if he does not actually do much about them. 

Dulling the impact of a twice-yearly focus on the state of the nation’s economy, in a budget and Autumn or Spring Statement, has suited recent chancellors and not just because the audits have rarely been great. 

George Osborne argued that it was not realistic to expect dramatic biannual events in the age of the internet and constant financial monitoring and management. Philip Hammond, Theresa May’s dour “spreadsheet” Chancellor, tried to combine the Budget and Autumn Statement into a single annual report. He failed. Chancellor Rishi Sunak turned his budgets into non-events by comprehensively briefing them in advance, only to have his plans quickly overturned by events including Covid. 

As if the independent Institute of Fiscal Studies was not strict enough on Budget “surprises” and “rabbits out of the hat”, Osborne set up the statutory Office for Budget Responsibility to set the boundaries for economic policy.

For the libertarian right, the IFS and OBR have come to typify the inconvenient “experts with organisations with acronyms” of which “the people have had enough”, first denounced by Michael Gove in 2016.  They are part of the “Deep State” according to Liz Truss. The  British economy crashed when she and her Chancellor Kwasi Kwarteng ignored the OBR for their ill-fated mini-budget. The Daily Telegraph describes the OBR as a “millstone around the Chancellor’s neck” because its forecasts will define the “headroom” for tax cuts on Wednesday. The Chancellor and the Prime Minister spent the weekend studying the OBR’s latest report before finalising the budget. 

Gordon “iron fist” Brown had to be in control. That meant setting the agenda out in advance himself. Hence Labour’s commitment to maintain the main Conservative tax rates was made before the election. Brown did know the value of surprise and managed to keep the announcement of Bank of England independence secret until after Labour had won. But he was also paranoid about leaks, especially by his own side. He generally preferred to dictate the terms of debate first. He never forgave Prime Minister Tony Blair “for stealing my f***ing budget” by telling David Frost on Sunday TV of plans to increase NHS spending to the European average. 

Chancellor Alistair Darling continued trying to set the agenda but went too far in Prime Minister Brown’s view when he told an interviewer that economic times were “arguably the worst they’ve been in sixty years”. His Conservative successors never laid themselves open to extended scrutiny. I lost count of the times George Osborne told me he would like to sit down for an extended interview during his seven years in the Treasury. He never did.

Budget Purdah was different. Ministers in the know cut back on their social engagements in the weeks leading up to the announcement for fear of letting slip something which could be of financial advantage or move the stock market. Loose lips had consequences. 

In 1936, the Colonial Secretary Jimmy Thomas left the government after telling a chum on the golf course about upcoming tax changes. Most famously in 1947, the Labour Chancellor Hugh Dalton resigned after chatting to an evening newspaper journalist on his way into the chamber to present his Budget. Dalton wrongly assumed the words would be out of his mouth and on the record before the early edition of the paper hit the streets. 

Until Brown, ministers, politicians and journalists respected pre-Budget reticence. In 1996, the Daily Mirror obtained a copy of Kenneth Clarke’s whole budget the day before he was to deliver it. The paper’s then editor, Piers Morgan, declined to publish it in advance and returned it to the Treasury, claiming that it was “boring” anyway. 

A bathetic re-run of the Dalton scandal occurred in 2013 when the London Evening Standard’s front page, disclosing the headlines from comprehensive official pre-briefing, appeared online before the Chancellor was on his feet at the despatch box.  An inquiry was ordered with results that further diminished scrutiny and the flow of quality information to the public. 

All official advance briefings for journalists, first established by Brown, were cancelled from then on. Until this fatwa, those involved in live broadcasting and instant reaction, such as me on Sky News, had been invited into the Treasury just hours before the statement to go through the details of the statement with civil servants. This was strictly under embargo. There was, in any case, barely time in which an embargo could be broken. 

These briefings certainly increased my understanding of technical matters and improved the public service I was able to deliver to the audience after the budget. I do not think they gave any party political advantage to the government of the day. The discussion was quite nerdy, even esoteric. I remember some amusement by officials about an obscure proposed “rotisserie” tax. Re-christened the “pasty tax”, this would bring on one of George Osborne’s biggest budget headaches.

The abandoned pre-briefings were a partial substitute for the post-budget media activity when Purdah was observed. Chancellor Nigel Lawson used to give a full off-the-record briefing to the Lobby immediately after his statement, followed by a press conference with specialist journalists the next morning which could last a couple of ideas. I learnt a lot at these meetings which I was able to impart to viewers.

Now, try as we will, all we get is uninformed waffle on the airwaves before the budget – and swiftly moving on – nothing new to see here – afterwards. 

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