Michael Brown: The most irresponsible budget I have ever heard

The Government has painted the opposition as the 'do-nothing' party

Related Topics

Prepare for a general election next year – if not in the spring, certainly by the autumn. Alistair Darling's temporary tax giveaways (much of which – especially the VAT reductions – will be clawed back in 13 months time) has all the hallmarks of addressing the political rather than the economic cycle.

Every cabinet minister will be under orders never to mention the "election" word. But it is inconceivable that Gordon Brown will want to risk losing the short-term advantages given by this pre-Budget report, before unemployment rises relentlessly to three million by the end of 2009.

This emergency pre-Budget report was the most irresponsible and profligate I have ever heard. But if Labour can persuade voters to focus only on the short-term, it amounts to one of the most politically generous attempts to bribe them with their own cash. It puts into the shade all previous pre-election giveaways. In terms of economics it is a huge gamble with the public finances. But in terms of pure politics it may yet turn out to be a triumph. By emphasising the immediate reduction in VAT and the bringing forward of child benefit uprating, tax credit increases and pension increases (the Chancellor is also bunging an extra one-off £60 payment to single pensioners and £120 to pensioner couples) the only conclusion must be, therefore, that a quick dash to the polls is uppermost on the Prime Minister's mind.

The notion that borrowing on such an unprecedented scale can ease a recession has always been nonsense and everything in yesterday's package will make the recovery even more difficult in the long run. How on earth Mr Darling can claim, with a straight face, to make predictions about the books being in balance by 2015/16 defies belief. What is certain, however, is that whoever forms the Government, after the next general election, will look back on this report as adding to the causes of all our future economic woes. It was only six months ago that the Chancellor made his over-optimistic forecasts about growth of 1.75 per cent for 2009 which turned to dust within weeks. If his forecast a year ahead was so inaccurate, how can voters trust his judgements of future growth and borrowing forecasts for up to six years ahead.

But no one should under-estimate the temporary breathing space this pre-Budget report has given to the Prime Minister. Combined with the reductions in mortgages, several million voters will see their disposable incomes rise by an average of £100 a month – provided they remain in employment.

The Chancellor is hoping that this additional cash, aided by the VAT reductions, will continue to be spent. I doubt this will actually occur. Surely after all that has happened following the credit card binge, most house-holders – having already learnt to cut back on discretionary spending, following the fuel and food price increases earlier in the year – will squirrel away any spare cash for the nightmare that lies ahead when the national insurance increases (an income tax rise in all but name) kick in in 2011.

Nevertheless, all this leaves the Tories in a tricky place. George Osborne is right to emphasise the ticking tax time bomb that has been placed in front of every elector, regardless of which party forms the next government. But there are enough short-term crowd pleasers to energise the Labour base with a clearly redistributive package from the super rich to Old Labour's core voters. Although the decision to increase the top rate of tax to 45 per cent for those earning over £150,000 raises little revenue, it will be well received by anyone angry at fat cat city slickers. The Tories will find it difficult to oppose this gratuitous tokenism but it will play well on the council house doorsteps.

Logic says the Tories should oppose every major measure announced yesterday. But the politics make this difficult. While Mr Osborne effectively summed up the nature of the recklessness of this pre-Budget report, he is open to the charge that he has no alternative to offer to address the current crisis. The Government has successfully painted the opposition as the "do nothing" party. A party vice-chairman, John Maples, stated a home truth when he said that recessions had to "take their course".

Frankly, there is probably little the Tories can do, in the short-term, apart from sit out their dilemma in the hope that the rise in unemployment will make voters understand that this package will turn out to be a chimera. And unless the Tories face up to recommending real reductions in public expenditure, the only choice at the next election is which party voters prefer to increase their taxes.

React Now

  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

SThree: Trainee Recruitment Consultant - Dublin

£13676.46 - £16411.61 per annum + OTE: SThree: SThree Trainee Recruitment Cons...

Ashdown Group: Marketing or Business Graduate Opportunity - Norwich - £22,000

£18000 - £22000 per annum + training: Ashdown Group: Business and Marketing Gr...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + Commission: SThree: Are you great at building rela...

Ashdown Group: Database Analyst - Birmingham - £22,000 plus benefits

£20000 - £22000 per annum + excellent benefits: Ashdown Group: Application Sup...

Day In a Page

Read Next
Labour leader Ed Miliband unveils Labour's pledges carved into a stone plinth in Hastings  

Election 2015: Smash the two-party system! Smash the voting system!

Armando Iannucci
Tactical voting is a necessary evil of the current first-past-the-post system, where voters vote against what they do not want rather than in favour of what they do  

Election 2015: Voting tactically has become more fraught in new political order

Michael Ashcroft
General Election 2015: Ed Miliband's unlikely journey from hapless geek to heart-throb

Miliband's unlikely journey from hapless geek to heart-throb

He was meant to be Labour's biggest handicap - but has become almost an asset
Amr Darrag: Ex-Muslim Brotherhood minister in exile still believes Egypt's military regime can be replaced with 'moderate' Islamic rule

'This is the battle of young Egypt for the future of our country'

Ex-Muslim Brotherhood minister Amr Darrag still believes the opposition can rid Egypt of its military regime and replace it with 'moderate' Islamic rule, he tells Robert Fisk
Why patients must rely less on doctors: Improving our own health is the 'blockbuster drug of the century'

Why patients must rely less on doctors

Improving our own health is the 'blockbuster drug of the century'
Sarah Lucas is the perfect artist to represent Britain at the Venice Biennale

Flesh in Venice

Sarah Lucas has filled the British pavilion at the Venice Biennale with slinky cats and casts of her female friends' private parts. It makes you proud to be a woman, says Karen Wright
11 best anti-ageing day creams

11 best anti-ageing day creams

Slow down the ageing process with one of these high-performance, hardworking anti-agers
Fishing for votes with Nigel Farage: The Ukip leader shows how he can work an audience as he casts his line to the disaffected of Grimsby

Fishing is on Nigel Farage's mind

Ukip leader casts a line to the disaffected
Who is bombing whom in the Middle East? It's amazing they don't all hit each other

Who is bombing whom in the Middle East?

Robert Fisk untangles the countries and factions
China's influence on fashion: At the top of the game both creatively and commercially

China's influence on fashion

At the top of the game both creatively and commercially
Lord O’Donnell: Former cabinet secretary on the election and life away from the levers of power

The man known as GOD has a reputation for getting the job done

Lord O'Donnell's three principles of rule
Rainbow shades: It's all bright on the night

Rainbow shades

It's all bright on the night
'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever