I don’t want to sound curmudgeonly, but Budgets don’t unravel like they used to. The golden age of slow-motion fiscal disasters – think the 2012 Budget or the Gordon Brown 10p tax rate debacle – is over.
This is in large part thanks to the Office for Budget Responsibility. In the olden days, journalists had to wade through the Red Book or wait for the Institute for Fiscal Studies to make its pronouncement (though I still do the latter).
These days, the OBR publishes – on Budget day – its ‘economic and fiscal outlook report’ – providing an instantaneous and rigorous analysis of what just happened.
The downside is this means the Chancellor of the day is far less able to get away with sleight of hand manoeuvres. Yet the upside is considerable too – less chance of having his (because we *still* have never had a female Chancellor) Budget mauled by the Sunday papers.
But modernity brings other problems. The worst news for Rishi Sunak since his speech did not come from the OBR, Labour or even horrified fiscal conservatives. As pointed out by James O’Malley, it came in the shape of a push notification from the BBC News app which read as follows:
“Middle-income families set to be worse-off next year amid rising costs and tax rises, says an independent economic think tank”
Suffice to say, this was not the headline the Chancellor was hoping for after being bullied by the Prime Minister into allocating £150bn to raise departmental spending by 3.8 per cent in real terms over the next three years.
Yes, the humble but mighty BBC News push notification. In the back of my mind it’s why Labour’s 2019 election promise of free broadband made such a large (and not wholly positive) splash – because the BBC decided to ‘push’ what otherwise was just another random spending promise from Jeremy Corbyn’s Party.
Anyway, the problem for Sunak is that it is true. The IFS simply points out that, because of tax hikes (the highest level since the 1950s) and inflation (double the Bank of England’s 2 per cent target) middle-earners are set to be worse off next year.
And if you want to find out what it means for you, check out our Budget tax calculator the whizz kids on our city desk have put together.
Elsewhere in the paper but still on the Budget, the OBR has said that Brexit (a choice freely made by the British people) will damage the UK economy more than Covid-19 (a pandemic during which we literally turned off large swathes of the economy).
And finally, want to feel old? The Spice Girls’ first album turns 25 - but will their legacy viva forever? Jessie Thompson, a nineties kid who grew up worshipping at the altar of girl power, serves up this deep cut.
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