I’ve listened to a lot of Budgets over the last ten years. None have irritated me as much as this week’s.
There were plenty of minor irritations in there. The ludicrous suggestion that unemployment isn’t that big a problem. The insistence on describing the recession as global and blaming it almost entirely on America and big banks (“a storm which began in America”). The lack of any detail about how the so-called “efficiency savings” so often promised might ever come about. The removal of stamp duty up to £250,000 for first-time property buyers (the main problem with stamp duty is the constraints it puts on labour mobility so removing it only for first time-buyers is pointless).
The endless use of the word ‘unprecedented’ as a policy defence. And, of course, the glossing over of the fact that whatever the arguments for cutting or not cutting spending at this stage in the economic cycle may be, cuts are already underway and most of the emergency stimulus measures put in place in 2008 are long gone. As the BBC’s Stephanie Flanders constantly points out, the impact of returning VAT to 17.5% is far greater than that of any of Darling’s minor spending announcements.
But for me the biggest irritation of all was the way Darling treated his change to his forecast for the budget deficit this year. It was £178bn, now it is £167bn. But instead of admitting that this is the most hideous problem, Darling behaved as though somehow it’s a good thing. He behaved as though, instead of being in a very slightly less large hole than he was a few months ago, he has somehow created a “surplus” to spend.
It’s bit like buying a handbag in the sales with your credit card – you might be paying for it on the never-never, but if it costs £100 rather than £250, you feel like you’ve got an extra £150 to spend. But you haven’t – no more than Darling has an extra £11bn to spend.
The other maddening thing about the budget was the repetition of the claims about the reduction in our budget deficit, which Darling claims he will halve in four years. The budget deficit is not the national debt. It is the level at which the national debt is increasing every year. So what Darling is promising is not a reduction of our national debt, but the halving of the speed at which we are increasing our debt. That’s hardly much of an achievement when even Italy is forecast to have dumped its deficit entirely by 2012. I know that one shouldn’t really judge oneself against others, but surely having significantly worse public finances than Italy isn’t the kind of thing of which most countries boast?
Still, that’s not the worst of it. The worst of it is that there is no way that, under Darling’s plans, even this will happen. The sums, such as they are, rely on Britain seeing economic growth of 3% plus every year from next year onwards. We know that can’t happen. Darling must do too. That makes this not just one of the most irritating budgets I have ever listened to, but one of the most dishonest too.