It was a sensible, Conservative budget – but will it be a success?
Chancellor Philip Hammond has now delivered the second Budget of 2017. He did so with humour and grace. On the face of it, he delivered a series of sensible, practical and Conservative measures. In ‘normal’ times this would and should be enough for a Conservative Chancellor. These, of course, are abnormal times.
Firstly we will only know if the Chancellor’s Budget has past the first hurdle of success in the next 24 to 48 hours. That is does it survive the immediate ‘unravelling’ test. Too many Budgets in recent years have failed this test for its passing to be taken for granted. Then, there are the weekend papers, particularly ‘the Sundays’. Reporters will have had three days to analyse and pick holes in the Chancellor’s numbers, the OBR projections, and speak to Conservative backbenchers and Cabinet ‘friends’ to inform their judgement of the budget’s success. If Philip Hammond can pass these two tests and is able to sit down to his Sunday morning breakfast in good order then, and only then, will we be able to say the Budget was successful.
An unholy alliance has sprung up in the Conservative Parliamentary Party between ardent ‘hang the cost’ Brexiteers, and ambitious and impatient 2015/2017 House of Commons new arrivals.. They are joined by a handful of marooned Cameroon former Ministers and acolytes. Together they form a powerful force criticising the Chancellor for his caution, calling for an end to austerity, anxious to see public spending increased, and advocating more government borrowing.
In his Budget Hammond resisted these increasingly wild calls for increased borrowing. The Budget contained a series of sensible measures, but it could not hide the fact that growth projections have been lowered, productivity continues to stagnate, and the National Debt remains at an historic high. The payments of the interest now account for the fifth largest amount of UK government expenditure. Paying off the debt, not just the deficit, should be a very high public policy priority.
The danger for the Conservative Parliamentary Party, and the country as a whole, is that accidentally or deliberately we forget the hard learned lessons of the 1980s and the early years of Conservative led government from 2010 onwards. Brexiteers are desperate, to the point of almost physical distraction, for Brexit to be an instant and huge success. It might well be, but it will take time, patience and confidence, not collective hysteria. The marooned Cameroons and new in-takers are desperate to move into, or return to, Ministerial office, and are wildly casting about for ways to assuage what they think is public opinion. They need to learn leadership is done from the front, not the rear, of the national debate.
The combination of Brexit, expensive housing and student fees has severely disrupted the relationship between younger people and the Party. It is a toxic and deeply worrying combination. At the same time, elements of the Parliamentary party seem all too willing to target older people with increasing alacrity. The Party has a hard won reputation for being trusted in its handling of the economy. By resisting the economically dangerous calls for greater spending and borrowing, the Chancellor did nothing to damage that reputation. For that, all Conservatives and the whole country should be both relieved and grateful.