This week, in the bizarre yet traditional briefcase-parading fashion, the Chancellor of the Exchequer twirled his shiny red box to the press and public, the contents of which beholding the UK’s most bewildering budget plan in decades.
Far unlike the tsunami of medieval measures that have materialised into vindicating the poor, disabled, minorities and women of previous Tory stunts, Rishi Sunak – who was drafted into the job at the last minute – unclasped a lucky dip on public spending. This includes a £30bn investment package that is said to rival Tony Blair’s spending and Gordon Brown’s borrowing.
As it stands, Sunak’s £600bn prosperity plan is quite literally nothing the likes of millennials have seen in their lifetimes: Budget 2020 boasts the highest net contribution to the public sector since the 1990s. One mic-drop moment even saw Sunank signify a tectonic shift in the Party as he claimed the Conservatives are now the “real workers’ party… the party of public services” – an announcement which was made all-the-more surreal by the carnival of cheers that cawed “this budget gets it done!” from backbenchers. Tories cheerleading on the sidelines to splash the cash is a sight many thought they would never live to see.
So, what exactly does it include?
A Coronavirus Battle Plan
The Budget is largely underpinned by the coronavirus ‘pandemic’ that is currently gripping the globe.
In a bid to mitigate fears that Covid-19 will reignite a 2008-style financial crash and subsequent healthcare crisis, Sunak announced a £5bn emergency funding pledge to aid the NHS on top of its £6bn budget. GPs and highly paid public servants are set to reap a tax relief on their pension contributions too as it emerged many vital NHS consultants were slashing hours to defend their retirement plans.
To better protect those impacted by the virus, Statutory Sick Pay (SSP) has been rolled out at a compulsory measure starting from day 1 of self-isolation, the Bank of England has slashed interest rates and the self-employed will receive payments in the form of Employee Support Allowance (ESA).
Tories cheerleading on the sidelines to splash the cash is a sight many thought they would never live to see
In addition, councils will gain a £500m hardship fund to combat the deadly disease, retail, leisure and hospitality will reap the rewards of temporarily abolished business rates while small to medium firms with fewer than 250 employees will be refunded sick payments.
However, there are still gaping flaws left unaddressed: those who don’t earn enough for SSP (estimated at 2 million people) are redirected to claim Universal Credit instead where the system is plagued with errors such as agonising six-week waits for payments. Others flatly cannot afford to live when in receipt of SSP – valued at £95 per week. In the face of hardship, many workers will have no choice but to go to work, even when exhibiting Covid-19 symptoms.
Infrastructure – It’s All Comin’ Up North
Still, Sunak’s yellow brick road appears paved with fixed-up potholes, fire-proof properties and fast-track lanes straight up to the North.
“If our country needs it, we will build it”, Sunak announced in line with a £640bn plan for roads, railways, houses and broadband, £27bn for motorways and £2.5bn for resurfaced roads. Finally addressing the combustible cladding issue that hugs many public and private properties across the country, Sunak granted £1bn, hopefully putting to bed the possibility of any Grenfell nightmare repeating.
Still, Sunak’s yellow brick road appears paved with fixed-up potholes, fire-proof properties and fast-track lanes straight up to the North
An estimated 6,000 jobs across Teesside, Humberside, Merseyside and Scotland and another 750 for a new civil service hub in the North is also designed within the Budget.
Mediocre Remedies for the Working Class
However, although many working folk will benefit from a tax relief as the National Insurance goalposts move from £8,632 to £9,500 in April, estimated to take 500,000 employees out of the tax bracket entirely and dishing out gains between £85-£104 for the average worker, Sunak’s budget doesn’t envision axing zero-hour contracts or addressing the social care crisis anytime soon.
Having said that, divvied up in the plan is some minor tweaks to the Universal Credit system. The Chancellor has eliminated, albeit small, some strain from the key chokepoints of the system including the removal of the Minimum Income Floor (MIF) and a lowered deduction rate on repaying debts from 30% to 25%. It means that claimants will get to keep more of their UC funding per month. Those affected by Covid-19 don’t need to attend the Job Centre to claim either.
It means that there actually is a magic money tree after all, only it has been watered and preened for its 2020 grand debut in Tory territory
National Living Wages are on the rise too, announcing a target of £10.50 an hour for 2024 which should make workers £5,200 a year better off when compared to 2010.
£5bn overall is pledged for public funding, £18bn for ‘levelling up’ the UK and £5.2bn for flood defences following some of the worst floods the UK has endured in decades this winter.
Crumbs for Women
Persistent campaigning from women’s rights groups might have seen the 5% VAT – dubbed the Tampon Tax – axed this April for women, saving the average women around £40 in her lifetime, and improved domestic abuse intervention programmes, reformed courts that better protect victims and services for rape and sexual abuse (£10m, £5m and £15m respectively), yet women are still left with the slim pickings of the government’s Big Budget Bonanza.
For a start, the funding is just a drop in the ocean when tackling violence against women and girls (VAWG) – estimated at £393m – which kills two women per week in the UK and kills more women annually than terrorism. The shiny new tax relief will barely stretch to benefit women either who make up the vast majority of low-income earners and single parents, although child benefit will inch slightly by 1.7%.
Women are still left with the slim pickings of the government’s Big Budget Bonanza
Still, migrant women largely remain absent from the protections within the Domestic Abuse Bill which, still in draft form, has been batted around for what feels like an age in the Commons amid the Brexit debacle and General Election.
Climate Change Unaddressed
Budget 2020 further leaves the most pressing issue of the modern era to fall through the cracks: climate change.
A new plastic packaging tax coupled with £640m towards protecting natural habitats – expanding peat bogs and catering to 30,000 hectares of land – is obviously a step in the right direction. Manufacturers and importers will also be billed £200 per tonne of plastic waste containing less than 30% recyclable materials as of April 2022 which should close in on the UK’s embarrassing contribution towards plastic pollution.
The Doomsday Clock will continue to accelerate much faster while our Government continues to tiptoe somewhere miles behind in the very real race against time
However, Whitehall’s decision to freeze fuel duty yet again while building new roads across the country vastly undermines these tepid efforts. It tells us that the Doomsday Clock will continue to accelerate much faster while our Government continues to tiptoe somewhere miles behind in the very real race against time.
High Tides for the UK Economy
The Home Office promises “whatever it takes”, it will do it to ensure that the British public will sail through these rocky waters to end up on sunnier shores.
Businesses are collectively buzzing with the announcement with director general of the Confederation of British Industry, Carolyn Fairbairn claiming the Budget is “a powerful signal to firms at home and abroad that the UK can and will manage the immediate challenges and long-term opportunities in parallel.”
How exactly are the Tories planning on funding its chocolate factory of churned out treats…?
Even money-saving guru, Martin Lewis of Moneysavingexpert.co.uk, couldn’t contain his shock: “We normally wait to see a rabbit pulled from the hat at the end – but here what we got was a procession of gerbil, after gerbil, after gerbil coming out of the hat” he said to BBC 5Live.
It’s “helicopter money – magic money being dropped from the sky” he added later on the subject of £3,000 grants to businesses, “it’s the type of thing we’ve not seen before”.
Budget Blows Holes into Labour’s Position
Labour ranks are certainly sulking this week as the Budget appears to blow gaping holes into their position of attack. What is the Left’s selling point now that austerity appears to have come to an abrupt halt?
Yet Labour does get to celebrate a ‘got-ya’ moment: austerity clearly always was a political will; a deliberately designed blueprint to hamper the vulnerable and obstruct the poor from climbing the social and financial ladder. It means that there actually is a magic money tree after all, only it has been watered and preened for its 2020 grand debut in Tory territory; its leaves undoubtedly fattened by the blood of those who have died as a consequence of draconian cuts that go as far back as Thatcher.
Jeremy Corbyn criticised the Budget as a “sleight of hand” since “it is only the biggest [investment] since [the Tories] began their slash-and-burn assault on our services, economic infrastructure and living standards in 2010.”
“Having ruthlessly forced down the living standards and life chances of millions of our people for a decade, the talk of levelling up is a cruel joke”, Corbyn continued.
The Tories appear to be shredding its core principles
However, he is on the backfoot now: both parties are poised in uncharted waters – and the Labour Party will need to adapt its strategy to function as the opposition. The Budget may be unveiled to a backdrop of decimated services and crumbling infrastructure, but the new Labour leader stepping into Corbyn’s shoes will have the fight of their lives ahead – providing the Tories actually deliver on its promises, which many aren’t holding their breath over.
Leaps and Bounds – for Tories
Indeed, how exactly are the Tories planning on funding its chocolate factory of churned out treats, topping additional borrowing by 2024 to an eyewatering £96.6bn, without raising taxes or rolling out blanket cuts again? Many economists believe the latter to be inevitable since the national debt could soar to a whopping £2 trillion years down the line. But at least now that the vaults have been prized open and the money tree wheeled out for all to see, Boris Johnson’s government will struggle more than ever to cruise austerity back through – but I wouldn’t put it past them.
The Conservatives are straying disobediently and uncharacteristically from the tight leash Cameron and Osborne reined in on Thatcher’s unfinished work
Besides, stagnated wages that have stretched over the course of the past decade have spiralled poorer families into the margins of the most extreme poverty to the indifference of the Tories – poverty that is reminiscent to a bygone era where children are left to starve throughout the school day and mothers forced onto the streets to sell sex to survive.
To revolutionise the UK and truly close the gap on the exacerbated inequalities across Britain, wages need to cater to the longevity austerity has had on communities and families. Sunak’s minor wage hike comes nowhere near ameliorating the years upon years of strife and loss.
The Institute for Fiscal Studies (IFS) further warn that the Budget is a pandora’s box: the plan to ‘level up’ the UK was previously announced for NHS, schools, defence and overseas aid. There is virtually nothing new, IFS argue, and that spending per head still falls below 2010 levels.
Still, the move is markedly unprecedented, in Tory terms anyway. Neither Sajid Javid or Philip Hammond would have dared push through such a budget that abandons the Conservatives core principals and shreds Thatcher, the architect of hardship, out of the plan. Sunak’s U-turn of all U-turns on austerity and investment has not only left economists and the nation dizzy with disbelief, but it suggests the Conservatives are straying disobediently and uncharacteristically from the tight leash Cameron and Osborne reined in on Thatcher’s unfinished work.
Those Labour-turned-Tory voters might find consolation in Johnson’s arms for the next decade
There is the mild possibility that the Tories are also tuning in to the fraught political landscape and are seeing a small window of opportunity to swoon in and set up camp. Painting the Red Wall permanently blue in the wake of Brexit might be easier than ever with a working class that is hostile and critical of the Left’s dogmatic approach to identity politics, unresolved antisemitism and the constant infighting. If the Budget delivers its lofty promises, it may well serve as the final nail in the coffin for the Labour Party and those Labour-turned-Tory voters who came over from Brexit and sit on the fence might find consolation in Johnson’s arms for the next decade.
[Header image: NEIL HALL/EPA-EFE/Shutterstock/FWI.]