Budget 1999: A Chancellor who positively revels in being an old- fashioned spender

NONE OF the leaks did it justice. All that talk about fiscal neutrality was blown away by a Budget that positively revelled in its old-fashioned injection, as the Chancellor put it, of pounds 4bn of purchasing power into the economy.

We had been ready for the new 10p starting rate, but not the 1p cut in the standard rate. We hadn't known that the new forecasts of unemployment- driven social security spending had been reduced by pounds 8bn - allowing the Chancellor to find the money for what was, when all was said and done, a Budget as populist as it was redistributive.

And as with the content, so with the performance. For a Chancellor whose public demeanour is positively austere, this was an unusually flamboyant performance. He teased his audience, he promised to ensure that the cost of alcohol would not go up before the millennium, and he skewered William Hague and Francis Maude by reminding us of their past words on two of the most potentially controversial elements - abolition of both the married couples' allowance, and mortgage interest relief.

On these last two points he has clearly got his way. Part of Brown's acumen as a chancellor, not for the first time, has been to see how easily some old-fashioned Treasury orthodoxy can be made to sit with left-of- centre redistribution.

Abolition of mortgage interest tax relief is, of course, easy to present as a left-wing squeeze on the middle classes; in fact it was Ken Clarke who started to whittle it away to something worth only about pounds 200 a year. During the Tory years it was not only Treasury orthodoxy but a target of some quite right-wing members of the Tory party, who thought it a perk too far and a distortion of the housing market, which it was.

Nigel Lawson, a chancellor whom Brown resembles in confidence and authority, as well as in a dislike of unnecessary tax breaks, would certainly have liked to abolish it. That it was preserved for so long was a function of Margaret Thatcher being, in truth, less of a Thatcherite than many of her followers, and insisting that the state had a duty to subsidise the marital home.

Similarly with the married couples' allowance. It is easy to understand that Tony Blair might have been a little nervous about the presentational problems it could cause in Daily Mail land. But it has become, as Gordon Brown pointed out with some vigour yesterday, a much more meaningless break than its propagandists would ever admit, and has appeared all the more of an anomaly since Lawson established independent taxation for men and women.

Independent taxation was one of the obstacles, however, to another widely predicted change which didn't in fact happen yesterday. The problem was that the non-working wife of a millionaire company chairman would still be able to claim it, while a hard-working middle-class woman who earned enough to be just above the higher rate of tax would not. But it was never entirely beyond the wit of the Treasury to find a way of taking the spouse's earnings into account, and Brown showed every sign of thinking that it could be done. Nor was there anything inherently socialist about doling out a benefit to those for whom, as Jilly Cooper once memorably said, it is worth a bottle or two extra of Sainsbury's champagne a week.

But this should not detract from what was an unexpectedly swashbuckling budget for the mid-term. So fast and furious came the spending and tax- cutting promises, that you hardly had time to notice when the Chancellor tore up competition policy by announcing a new, all-powerful agency that will henceforth, just as the Bank of England did on interest rates, relieve the Secretary of State for Trade and Industry from most quasi-judicial decisions on mergers.

The Labour backbenchers were ecstatic about many of the announcements - perhaps most of all for announcing a quadrupling of the pensioners' winter allowance. But in fact this was a Budget which, perhaps more than any previous one, encapsulated Gordon Brown's driving idea - that it is possible to combine a passion for social justice with as much enthusiasm as the most ardent Thatcherites ever had for enterprise and entrepreneurship.

The milk and honey may not yet flow quite as lavishly as the Chancellor implied. The assumptions on which his increased freedom for manoeuvre depend require the industrialised countries not to slip into a global economic crisis.

And the Budget itself was a mite less generous than the Chancellor made it look yesterday: indirect taxes will go up; the 1p standard rate cut is not till next year; the 20p rate goes up to 23p and then back to 22p when the 10p rate comes in next year. Nevertheless it was a bravura performance by a Chancellor who knows that his resolute resistance in the first two years in office to all the temptations to which previous Labour governments had been prey, is starting to reap its reward. So expansive was his performance, that you might almost think there were an election or four in the air. I count one local, two national and one European myself.

Suggested Topics
News
peopleFrankie Boyle responds to referendum result in characteristically offensive style
Arts and Entertainment
Highs and lows of the cast's careers since 2004
News
news
New Articles
i100... with this review
PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Day In a Page

Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam