Your Money: Blackmail and bribery? Never!

There was a remarkable unanimity of opinion from pundits and assorted experts over the contents of the Chancellor's Budget last week.

The perception was that Kenneth Clarke's Budget, short of the amiability and jokes aimed against Labour, was rather a boring affair, one directed primarily at calming the markets and preventing any sudden interest rate rises in coming weeks.

Now, of course, the jury is still out on that one. More important is whether the Budget was, in fact, boring at all. I tend to disagree with this view.

Mr Clarke's speech was one of the most overt pitches for the skilled working class vote made in virtually any Budget for almost a decade.

Consider the evidence. The last time the Conservatives tried to woo this particular constituency, it was done by selling off council houses and privatised companies' shares at massive discounts. Tax breaks to skilled workers were a by-product of the greater giveaway to rich people.

This time, things have been different. For example, the Government has increased the personal allowance from pounds 3,765 to pounds 4,045 - three times the rate of inflation. The 20 per cent tax band has been expanded by pounds 200, twice the rate of inflation.

By contrast, his more unpalatable proposals are to be phased in over two years - starting in 1997 or even 1998. Profit related pay (PRP) is one obvious example.

In recent years, PRP had become a useful tax avoidance scheme for many companies, while failing to achieve the Government's stated aim of making employees feel more responsible for their company's fortunes. So Mr Clarke is scrapping it. At first sight, this is counter-productive: there are almost four million people who will be disaffected by this announcement.

Except that his plans won't kick in for at least two more years. Many companies are indicating that they expect to make up some or all of their employees' foregone income.

There is, however, one important difference between then and now. The relative paucity of Mr Clarke's generosity shows how little he had to give and how far he is boxed in by the conflicting demands of hard-done- by taxpayers and the City.

Even more important than this is the question of whether it will work. Will pattern makers in Birmingham and plumbers in Bristol forgive Mr Clarke's government for all the previous tax rises, the pain of negative equity and the job insecurity they have suffered from in the past few years?

If they do, their memories will be very short indeed.

Alliance & Leicester is in the news again over its objections to a proposed Bill which may remove rights enjoyed by de-mutualising building societies.

The Bill proposes that should the society go on the takeover trail after its stockmarket flotation next year, it could lose its own protection against other predators. Not surprisingly, Alliance & Leicester is miffed. It threatens - sotto voce - to delay its flotation, and with it a free shares handout worth pounds 1,000 to each of its 2.4 million members.

I am in full support of its strategy and do not for one second believe it to be a bid to blackmail the Government. Indeed, I go one stage further.

Since the A&L is clearly too puny to hack its way with all the other companies on the FT-SE 100 shares index, who themselves do not enjoy similar protection, it should abandon its flotation plans forthwith. I am sure its members will back the board in this decision. After all, what is a mere pounds 1,000 a head when such important principles are at stake?

Steve Lodge is back next week

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
Brendan O'Carroll as Agnes Brown in the 2014 Mrs Brown's Boys Christmas special
tvCould Mrs Brown's Boys have taken lead for second year?
News
Members and supporters of the lesbian, gay, bisexual, transgender (LGBT) community walk with a rainbow flag during a rally in July
news
Sport
footballLive! Chelsea vs West Ham kicked off 10 Boxing Day matches, with Arsenal vs QPR closing the action
News
peopleIt seems you can't silence Katie Hopkins, even on Christmas Day...
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
News
i100
Arts and Entertainment
Jack O'Connell stars as Louis Zamperini in Angelina Jolie's Unbroken
film review... even if Jack O'Connell is excellent
Arts and Entertainment
Madonna is not in Twitter's good books after describing her album leak as 'artistic rape and terrorism'
music14 more 'Rebel Heart' tracks leaked including Pharrell Williams collaboration
News
news
Arts and Entertainment
Wolf (Nathan McMullen), Ian (Dan Starky), The Doctor (Peter Capaldi), Clara (Jenna Coleman), Santa Claus (Nick Frost) in the Doctor Who Christmas Special (BBC/Photographer: David Venni)
tvOur review of the Doctor Who Christmas Special
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

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Day In a Page

A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all