My speech during the debate on the Budget, 29 October 2018

John Redwood (Wokingham) (Con): I have declared my business interests in the register, but I am not going to be talking about them.

I welcome this Budget. I particularly welcome the decision to provide some more money for crucial public services. In Wokingham and West Berkshire, we need more money for social care, and there is some in the Budget. We need more money for our local surgeries and hospitals, and a lot of money will be coming through for the health service in the years ahead. I just urge the Government to ensure that it is well spent and that there a proper prospectus before the money is finally committed in detail.

We definitely need more money for our roads and local transport. I am pleased to see funds with imaginative ideas to improve flows and safety over junctions and to ensure more roundabout junctions and improvements in strategic local route networks. I will be working with West Berkshire and Wokingham Councils, encouraging them to come forward with schemes that I hope qualify, because these are important to the productivity of my part of the world and, indeed, any part of the United Kingdom. Anyone with customers or clients in their area who goes to work daily in a van or car cannot book as many appointments as they would like and might lose one or two contracts each day because they are spending far too many minutes or even hours in traffic jams, particularly at the busy periods of the day. We therefore need to improve flows, which can also improve safety and lower fuel usage, which would be great benefits.

I also welcome the way that the Chancellor is injecting a bit more money into the economy, because there has been quite a sharp fiscal and monetary squeeze administered to the economy since March 2017. The story so far is one of dreadfully inaccurate forecasting by the OBR and the Treasury. We had the idiotic, wild forecasts about how we would have a recession, falling house prices and a big increase in unemployment if we voted to leave the European Union. They said that that would happen in the winter of 2016-17, whereas I am pleased to say that the economy continued to grow pretty well until March 2017. Jobs and employment went up and house prices did not tumble in the way that was forecast, because Brexit was not bad news. A lot of people thought that Brexit was very good news, and they went out and spent a bit more money because they liked it.

We then had a fiscal and monetary squeeze. The Bank of England has put interest rates up, and it withdrew special lines of credit from the clearing banks and issued instructions to lend less against cars and certain types of houses. That had a visible impact on the car and housing markets. We had a fiscal squeeze, because as we see in today’s figures, in this year alone £7.4 billion more has been collected in tax and £4.5 billion less has been spent on public services than was forecast in March. There has therefore been a £12 billion—I presume unplanned—fiscal squeeze on the economy since March, and there was also a squeeze in the previous year, combined with a rather sharp monetary squeeze, whereby money growth has now halved, as a result of what I think was the Bank of England’s fairly untimely and overdone interventions. I do not think there is a huge inflation problem out there, and I think the action that it has taken is too strong.

I am therefore delighted that something has been given back. What the Chancellor is giving back next year—about £11 billion—only matches the £12 billion of the squeeze that was being taken out this year. The OBR says, “This is a big giveaway,” but it is not actually a giveaway compared with what it said as recently as March this year. One needs to put that into perspective.

We now have to discuss what impact Brexit will have. All the forecasts grossly exaggerate the economic impact of Brexit. It is an extremely important political event, but I do not think we will see it on world economic graphs when we look back in two or three years’ time, and I think we would be hard pushed to see it on the graphs of the UK economy as well. The effect could be reasonably neutral. If we go for a no-deal Brexit because, unfortunately, the EU does not offer us something that is better than no deal, or if there is a continued breakdown in the negotiations—at the moment, the Chequers plan does not look very popular with the EU—then, yes, the Chancellor is right that we will need an additional Budget, but it will be a Budget full of good news because it will be the Budget to spend the £39 billion.

An awful lot of Brexit voters voted in part to take back control of our money. The OBR confirms that if we go ahead with the withdrawal agreement it has in mind, we will indeed be asked to spend £39 billion, sending that money over the exchanges to be spent in relatively rich continental Europe rather than having it available for our own priorities here. So will it not be great to have a Budget to confirm that we can spend £39 billion in a no-deal scenario?

Sir Henry Bellingham (North West Norfolk) (Con): A moment ago, as my right hon. Friend will recall, I also made the point about the £39 billion. It is incredibly important that the Government clarify the situation on that, because some Ministers are saying that part of it is owed contractually in many different ways, while other Ministers are saying that the whole lot would revert to the Treasury in the event of no deal. Surely, the Minister must clarify that when he winds up.

John Redwood: I have looked into this. I have taken advice from lawyers. I have also read the report from the House of Lords—not a known bastion of leave enthusiasm. Its legal conclusions were wholly admirable. It said, “No, there is no legal requirement to pay a penny to the EU after we have left.” If we leave on 29 March 2019, we would definitely save that money. There is no requirement to pay. We did not get a bonus when we joined the thing, because there were lots of inherited liabilities, so we do not have to go on paying for liabilities after we have left. That is quite an absurd proposition. We should be able to grasp this opportunity.

If we were able to spend that £39 billion over a three-year period—I know that it is spread over three years and does not come all in one year—there would be, over that period, a 2% boost to the UK economy. That could take our growth rate back up to about 2% per annum. The OBR forecasts are a bit gloomy, and it could be that our economy has grown by only 1.5%, but that is underperforming. We need to ask why that is, and it is certainly nothing to do with Brexit. The reason the growth rate fell is, as I say, deliberate policy by the Bank of England and possibly inadvertent policy by the Treasury creating a combined monetary and fiscal squeeze. This Budget does something to start to lift the fiscal part of that squeeze, and that is very welcome.

It is crucial that we do end austerity. I am absolutely with the Prime Minister on this.

Indeed, I fought two elections on the proposition that we want prosperity not austerity. I strongly agree with the Chancellor that we should define austerity, as the public do, in its wider sense. Austerity does not just mean not having enough money for social care, which we need to remedy; it means that people’s real wages have not gone up enough or at all, so they are not better off. People expect us collectively, as a result of our interventions in the economy and our supervision of the general position, to help them to progress and have real income increases so that they can afford more and improve their lifestyles as they go on life’s journey. That is what we should be doing. We should be in the business of promoting more jobs, better-paid jobs and lower taxes so that people keep more of the money from those jobs and the income they are earning. I therefore welcome the bringing forward of the income tax reductions, which will be very helpful.

I also strongly support tackling the problem of low pay. There is still too much low pay, and I am glad that the Government regard this as an important issue. We need to do more on productivity measures, because the real way to eradicate low pay is by higher productivity: “work smarter and get paid more” is what we need to be thinking and doing. That requires a whole raft of the policies that were mentioned in the parts of the Budget document on education, training, transport and many other areas. That will contribute to making a more productive economy.

I am fully behind the Government’s aim of banishing austerity. I am fully behind the aim of getting real wages up and allowing people to spend a lot more of their own money. I want the £39 billion because that would be a really knock-out blow in getting a stronger and better economy.

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60 Comments

  1. Peter
    Posted October 30, 2018 at 10:09 am | Permalink

    Voting down the budget as part of the war on Brexit in Name Only now seems to be off the table. Hammond had to appear generous for political reasons.

  2. miami.mode
    Posted October 30, 2018 at 10:20 am | Permalink

    But surely the Chancellor said recently that we would have to pay at least £30 billion in the event of no deal. If he and the PM truly believe this, then it will only serve to ensure any sort of deal is done to justify the £39 billion

  3. fedupsoutherner
    Posted October 30, 2018 at 10:34 am | Permalink

    My God John, you must be very unpopular in the world of the treasury! I hope they are listening. Particularly liked your comments about Brexit. What a future this country could have if we just left. As you say, the money would be better spent in our own country and not propping up others while we work our butts off.

    • Mockbeggar
      Posted October 30, 2018 at 11:49 am | Permalink

      I particularly enjoyed your sideswipes at the Bank of England which has not served the country well over the last few years.

    • margaret howard
      Posted October 30, 2018 at 8:03 pm | Permalink

      “. What a future this country could have if we just left.”

      Back to what we were before we begged to join – ‘the sick man of Europe’?

      • Edward2
        Posted October 30, 2018 at 11:46 pm | Permalink

        You are living in the past margaret.
        It is over 40 years ago.
        Look forward.
        Great opportunities ahead of us.

      • Fedupsoutherner
        Posted October 31, 2018 at 5:35 am | Permalink

        A lot has changed since then Margaret. Move with the times. You have no confidence in your own country. Shame on you.

      • Know-Dice
        Posted October 31, 2018 at 10:06 am | Permalink

        Margaret,

        All the countries of Europe have been “The sick man” at one time or another…not just the UK.

        We joined the Common Market not some ongoing political project.

        Please can we have your comments on the Five Presidents Report which is more relevant to the future direction of travel of the EU?

        https://ec.europa.eu/commission/publications/five-presidents-report-completing-europes-economic-and-monetary-union_en

    • Richard
      Posted October 30, 2018 at 10:43 pm | Permalink

      Good speech by our host.

      The Economists for Free Trade says OBR are far too pessimistic (assuming Canada+ FTA or World Trade Deal) https://www.telegraph.co.uk/politics/2018/10/30/must-not-enslaved-obrs-anti-brexit-instincts/

    • Dennis
      Posted October 31, 2018 at 2:17 pm | Permalink

      Why then does May say we are an honourable country so we will pay our commitments. What are these commitments?

      Can anyone get May to say that legally we owe nothing? I bet not.

  4. Ron Olden
    Posted October 30, 2018 at 10:36 am | Permalink

    This issue of defining of ‘austerity’ is an important one.

    This term should never have come into common usage in the first place. It started in places like Greece where people really have endured ‘austerity’.

    But we’ve seen nothing like that.

    Labour believes that ‘austerity’ is when the government itself doesn’t have as much money as it wants (i.e. always), and claims that tax rises are a ‘solution to austerity’.

    All tax rises achieve is to transfer wealth and purchasing power away from us and to the State. It makes (so called) ‘austerity’ worse, not better.

    This mindset is indicative of Labour. I remember Gordon Brown saying that cutting tax would ‘take money out of the economy’. What he really meant is that he thinks the Government IS the economy.

    Any normal person would say cutting tax puts money IN to the economy.

    I’m not particularly impressed with these OBR Budget Deficit forecasts either.

    £25.5 Billion for this fiscal year seems bit low to me. I would have been more cautious and said closer to 30.

    Buy why is the budget deficit thought to go back up again next year?

    Had I been Hammond I’d have kept most of these goodies back and (assuming the money is still there) given them away in the Spring Statement at the earliest, or closer to the next General Election.

    It better politics.

  5. Henry Spark
    Posted October 30, 2018 at 10:38 am | Permalink

    Our government has agreed to pay the £39 million. It is shameful that you are advocating that the UK should be seen not to honour its promises.

    Reply The sum is £39bn. The government and the EU has always said nothing is agreed until everything is agreed. Much of the payment relates to staying in the EU for another 21 months, so why would we pay if we are leaving early?

    • Know-Dice
      Posted October 30, 2018 at 10:56 am | Permalink

      Henry, I draw your attention to this EU document:

      European Council (Art. 50) guidelines for Brexit negotiations

      https://www.consilium.europa.eu/en/press/press-releases/2017/04/29/euco-brexit-guidelines/

      I. Core principles

      2. Negotiations under Article 50 TEU will be conducted in transparency and as a single package. In accordance with the principle that nothing is agreed until everything is agreed, individual items cannot be settled separately.

    • Denis Cooper
      Posted October 30, 2018 at 11:22 am | Permalink

      I would agree with Sir Henry Bellingham that the government should clarify the situation. It has been clear from the time of the Lords report eighteen months ago that there is the legal position, but there are also political ramifications:

      http://johnredwoodsdiary.com/2017/05/09/mr-macron-guides-france/#comment-867809

      “23. It follows that, under EU law, Article 50 TEU allows the UK to leave the EU without being liable for outstanding financial obligations under the EU budget, unless a withdrawal agreement is concluded which resolves this issue. (This advice does not address the political consequences of the UK withdrawing from the EU without settling outstanding payments to the EU budget and related financial instruments.”

      It seems to me that if the Irish government persists with its absurd extreme and intransigent position over the border, as I expect it will, then the UK government can justifiably respond that it has always proceeded with goodwill, including by its generous acquiescence to a financial settlement going beyond anything necessary under law, but now it is no longer willing to pay anything at all.

    • Richard1
      Posted October 30, 2018 at 11:27 am | Permalink

      I’d be OK with another referendum on that specific question – If there is no Deal do you think people would think it right UK taxpayers make a £39bn gift to the EU?

    • Denis Cooper
      Posted October 30, 2018 at 11:40 am | Permalink

      “Our government has agreed to pay the £39 million.”

      Another Remoaner lie; day after day any lie will do for Remoaners, including the clutch of Remoaner trolls who are inexplicably tolerated on this site.

      https://ec.europa.eu/commission/sites/beta-political/files/joint_report.pdf

      “This report is put forward with a view to the meeting of the European Council (Article 50) of 14-15 December 2017. UNDER THE CAVEAT THAT NOTHING IS AGREED UNTIL EVERYTHING IS AGREED …”

    • Roy Grainger
      Posted October 30, 2018 at 12:04 pm | Permalink

      Henry – The government is unable to agree to pay 39bn, if it wants to pay it then it has to be passed by the House of Commons. It is shameful you want to subvert democracy by bypassing the Commons on this.

    • michael mcgrath
      Posted October 30, 2018 at 3:29 pm | Permalink

      Reply to reply

      ” Much of the payment relates to staying in the EU for another 21 months”

      How much and on what and what does any balance cover…in as much detail as possible please

      • Know-Dice
        Posted October 31, 2018 at 10:13 am | Permalink

        Good question to which we (the people of the UK) deserve an answer.

        Is it up and above any “commitments” to the EU budget cycle?
        Is it up and above what we would normally pay until 29th March 2019 plus any implementation period?
        Does include a rebate for EU assets relinquished?
        Does it include ALL pension liabilities, including those that hung their “national hat” at the door when they were employed by the EU?

    • Posted October 30, 2018 at 4:29 pm | Permalink

      And anyway – why should we pay for a trade deal? Isn’t that a bribe offered to foreign officials? And isn’t that illegal?

    • old salt
      Posted October 30, 2018 at 6:40 pm | Permalink

      ” so why would we pay if we are leaving early?”
      A rather big ‘IF’ John! If only!

    • Steve
      Posted October 30, 2018 at 9:08 pm | Permalink

      Henry Spark

      Henry, it has nothing to do with promises. We do not owe this money, and as our host has pointed out we are not under any legal obligation to pay it.

    • Dennis
      Posted October 31, 2018 at 2:25 pm | Permalink

      Reply to reply – “Much of the payment relates to staying in the EU for another 21 months, …”

      JR you are so unclear. “Much of the payment…” what is the rest for? It seems every reply you give raises more questions.

  6. Duncan
    Posted October 30, 2018 at 10:49 am | Permalink

    ‘If we leave on 29 March 2019’

    ‘if’ not when. If not when. If not when. What an utterly tiresome the Tories have become.

    ‘If’ translates into, ‘we haven’t got the guts to depose May so we’ve decided to stay in the EU

    Deeds not words. We are sick and tired of verbosity and hot air

    Even John’s decided that the UK will not be leaving the EU

    The People’s Will will be ignored. Welcome to Mandelson’s ‘Post democratic age’. An age in which voters are viewed with absolute and utter contempt and sovereign direct democracy a barrier towards absolute centralisation

    Politicians now use words to conceal rather than provide transparency

    I hope that at some point in the future democracy is completely defused and at that point the people then wake up and realise they’ve been royally conned and they’ve walked into an autocratic trap. Then things might change for the better

  7. Nig l
    Posted October 30, 2018 at 10:52 am | Permalink

    Bravo. Knocks on the ‘head’ the lie that we have owe the £39 billion. Presumably Ollie has agreed it and I suspect other ongoing financial commitments to save his mates in the EU from stumping up to cover our leaving, rather than, of course, expecting them to cut their cloth!

    • Oxiana321
      Posted October 30, 2018 at 9:09 pm | Permalink

      Getting civil servants to stop a 39 billion bung going to the EU to cover their mates gold-plated pensions is surely like turkeys voting for Christmas.

  8. Iain Gill
    Posted October 30, 2018 at 11:32 am | Permalink

    too soft on the government john

    I would have told them a lot of home truths

  9. ian
    Posted October 30, 2018 at 11:40 am | Permalink

    I think that speaks might have lost on the front bench.

  10. Andy
    Posted October 30, 2018 at 12:01 pm | Permalink

    You misquote the Lords.

    Their report actually says that there are competing interpretations about what the UK should pay for your Brexit. And while they say the UK legal position is strong they also acknowledge that your stance of paying nothing and walking away in a huff is undesirable – and would likely cause significant difficulty elsewhere.

    Facts are awkward, aren’t they?

    • Edward2
      Posted October 30, 2018 at 11:48 pm | Permalink

      Not really, considering they actually said there was no legal obligation to pay anything to leave.

    • Anonymous
      Posted October 31, 2018 at 7:41 am | Permalink

      “…your Brexit.”No. OURS.

      Did you take part in the referendum ? Yes. Well that means you pledged to support the result.

  11. Denis Cooper
    Posted October 30, 2018 at 12:27 pm | Permalink

    It’s worth recalling the greedy attitude of Jean-Claude Juncker in February 2017:

    https://www.theguardian.com/world/2017/feb/21/britian-should-expect-hefty-bill-for-brexit-jean-claude-juncker-european-commission-salty

    “UK should expect a very hefty bill for Brexit, says Jean-Claude Juncker”

    “Using the French slang word “salty”, meaning hefty or pricey, he added: “Therefore the bill will be – to use a rather vulgar term – very salty.”

    A month before I had pointed what should be obvious:

    http://johnredwoodsdiary.com/2017/01/22/discussions-with-the-eu-on-departure/#comment-853178

    “It should be understood that we are not expected to hand over this money because we are leaving the EU but because we joined in the first place, and agreed that the organisation would not only spend what it had in any year but also enter into substantial commitments for future years. If we stayed in the EU we would be handing over this money, and more besides, year after year to help the EU meet those agreed future commitments.”

    And later suggested:

    http://johnredwoodsdiary.com/2017/01/29/there-is-no-legal-basis-for-making-any-extra-payments-to-the-eu/#comment-854216

    “So it might be wise for the government to say something like:

    “Her Majesty’s government admits no legal liability for the payments demanded by the EU. However from its goodwill towards the peoples of the other member states the UK is prepared to negotiate certain ex gratia payments towards the satisfaction of future financial commitments made by the EU which were agreed while the UK was still a member state.””

  12. Geoff not Hoon
    Posted October 30, 2018 at 1:01 pm | Permalink

    The OBR say a “big giveaway”. In reality it is nothing of the sort. Whose money is/was it in the first place.

  13. Newmania
    Posted October 30, 2018 at 1:12 pm | Permalink

    The legal opinion of the HOL was not a unanimous but it is beside the point .The UK understood the existence of the reste à liquider and befitted from it as we entered. We committed ourselves to the current cycle . End of.
    If you order a meal and then rushed out leaving our mates to get the bill, they have no legal means of enforcing payment but we would no longer be mates .If you rob a train you cannot legally be extracted from Brazil but we cannot steal from our major trading and defence partners without consequences
    Give the amount UK debt owned by our neighbours the assets in the EU the potential for aggressive trade measures this is not reality. It is simply Brexit` fantasists hoping to waffle their way out of responsibility for the grim price tag attached to their hobbies .

    • Edward2
      Posted October 30, 2018 at 11:50 pm | Permalink

      Would you pay for the next people to sit at your table?

    • libertarian
      Posted October 31, 2018 at 1:45 pm | Permalink

      Isn’t it strange how weird Remainers like Newmania and Andy are.

      They hate this country, hate older people, hate anyone with a different opinion . They have no real idea of how the EU works, even less idea about international trade and business. They despite being asked multiple times can’t give any good reasons to stay in the EU BUT they really really really want to give away billions of pounds of hard earned taxpayers money in return for er absolutely nothing

      Strange strange people

  14. Posted October 30, 2018 at 1:16 pm | Permalink

    Excellent John !

    I knew you were never a fiscal conservative and understood how the monetary system operates. I’ve said it all along.

    Fiscal conservatives thik we use a single currency and not a sovereign one and it was the whole reason to get out of the EU.

    “The story so far is one of dreadfully inaccurate forecasting by the OBR and the Treasury”

    That’s because their models are from a bygone age and they use a budget constraint instead of an inflation constraint. A worls when we were still on the gold standard and used fixed exchange rates.

    What governments in power need is a clear answer to the following question from the OBR.

    If we increase the government budget deficit and thus increase the private sector surplus will we cause inflation ??

    Unfortunately, their models as they stand do not answer that question which is why they are so far off. More importantly when the private sector surplus increases it is impossible to determine how much the private sector is going to save.

    Without knowing how much the private sector is going to save we won’t know how much we have to borrow.

    A non sensical budget constraint has to be replaced with an inflation constraint when it comes to these forecasting models. Can you get the ball rolling John ??

  15. Brian Tomkinson
    Posted October 30, 2018 at 1:29 pm | Permalink

    Pity there aren’t more like you in the Commons. Your talents, and those of others, are underemployed on the backbenches whilst incompetents occupy both front benches.

  16. Denis Cooper
    Posted October 30, 2018 at 1:41 pm | Permalink

    Off-topic:

    https://www.independent.co.uk/news/uk/politics/theresa-may-snap-election-brexit-latest-norway-visit-budget-philip-hammond-a8608396.html

    “The PM was speaking alongside Erna Solberg, the Norwegian prime minister. Ms Solberg warned that plans suggested by some Tories for the UK to joint the European Economic Area (EEA) temporarily as a second Brexit transition would be “a little bit difficult” for some members to accept. She however re-stated that Norway was open to the UK becoming a permanent EEA state.

    The European Economic Area agreement replicates most of the EU single market, with some exceptions – though it does not include a customs union, meaning border checks are still required on goods passing from the EU.”

    • Denis Cooper
      Posted October 30, 2018 at 1:54 pm | Permalink

      Jesus wept, what an idiot this man is, how on earth did he get to be an MP?

      https://twitter.com/NickBoles/status/1057254666021625861

      “This is obviously disappointing. But what matters is being in EFTA pillar of EEA, not full membership of EFTA. And if Parliament rejects the PM’s deal the question for everyone will be: which do they prefer Norway for Now or no deal?”

      And what about the Irish government having categorically rejected anything like the customs border between Sweden and Norway?

      It’s nearly a year ago now:

      https://news.sky.com/video/is-the-norway-sweden-border-a-solution-for-ireland-11141058

      “Is the Norway-Sweden border a solution for Ireland?”

      “Sky’s Lewis Goodall takes a look at the border of Sweden and non-EU Norway and whether it could work as a model for Ireland post-Brexit.”

      Would something like this be good enough for the Irish government?

      Nope, and from 03:12 in, they reject:

      “anything that would imply a border on the island of Ireland”.

      How long will this take to penetrate the thick skulls of the EFTA/EEA fanatics?

  17. Nigel Seymour
    Posted October 30, 2018 at 2:12 pm | Permalink

    Should have put this on the new 50p coin – “Free at last, Free at last, We are free at last.”

  18. Nig l
    Posted October 30, 2018 at 3:12 pm | Permalink

    Ps. One minute he is berating us that we have to be very cautious because of the negative effects of Brexit, the next minute throwing masses of money around that he does not have.

    Being cynical of everything the Treasury does, is this a bribe to show what we get from EU membership and when will the threats come that if we are not good people and rock the boat, he will take it all away again?

  19. Adam
    Posted October 30, 2018 at 3:59 pm | Permalink

    Working smarter is much more efficient than working harder.

  20. Lifelogic
    Posted October 30, 2018 at 4:05 pm | Permalink

    It was an idiotic butget increasing government spending (largely wasted) further is the last thing we need.

    He all issued the idiotic threat that if we fail to get a good deal he will punish us with a tigher budget.

    As Roger Bootle correcly puts it today in the Telegraph today, but not quite use these words:- Hammond is an economic illiterate and essentially a duff Labour Chancellor, only slightly better than McDonnall.

  21. Bob
    Posted October 30, 2018 at 5:00 pm | Permalink

    Mr Redwood,
    Does Mr Hammond’s new Business Rates Relief apply just to retail business?
    If so, then why?

  22. Jason wells
    Posted October 30, 2018 at 5:28 pm | Permalink

    JR..why do you say “unfortunately” when talking about going for a no deal..
    Surely going for a no deal has to be the best option..or so we have been told over and over.

    UK has made the running on all of this brexit thing so surely it is up to us to decide whether we want to leave with a deal or with no deal..The EU for their part have their rules based system and just sit there, either we fit in in some way or other and depending on red lines, both sides, with a new deal, it will be our decision but subject to agreement from the EU side..don’t know why we spend so much time analysing the budget either when we all know we are going to have to have another emergency one in four months time..it’s all BS

  23. Edward2
    Posted October 30, 2018 at 5:29 pm | Permalink

    If only JR was our PM.
    Or our Chancellor.
    Wonderful speech.

  24. formula57
    Posted October 30, 2018 at 5:44 pm | Permalink

    The budget might have flummuxed Mr. Corbyn but not the rest of us and clearly, despite your welcome for it, not you as you gave us your much better proposals the other day.

    It will be soon forgotten, even in its generally pleasing aspects. It does not increase the Government’s political capital as its message lacks vision, being neither bold not coherent nor clear. It betrays the same timidity and lack of adroitness as is evident in much else this Government does and its suitability even in the near term must be doubted.

  25. Cost Cutter
    Posted October 30, 2018 at 7:48 pm | Permalink

    The Rt Hon Hammond didn’t mention the TV licence fee. A bit much.It should be increased.
    £10000 per second.

  26. mancunius
    Posted October 30, 2018 at 8:40 pm | Permalink

    I would not take this budget at face value. I notice that quite a lot of it is redistributive gifts to unproductive interests (welfare recipients, NHS, lower income allowances, minimum wages, alcohol taxes frozen etc).
    So when Hammond then announces with crocodile tears that he is (alackaday!) forced to reverse them ‘because of Brexit’, that’s a lot of not terribly savvy voters who will suddenly be converted to the idea of returning to the warm embrace of Brussels in a second referendum that May/Hammond will suddenly find essential (having extended Art. 50 at the very last moment)
    You think May and Hammond couldn’t possibly be cynical enough to plan it, or that they might get away with it? Let’s wait and see.

    • a-tracy
      Posted October 31, 2018 at 11:23 am | Permalink

      I agree mancunius.

      The Labour party immediately started to decry the increase in tax allowance for the wealthiest with no rebuttal from Hammond and the Treasury.

      I read there has been a £1.7bn cash injection to benefit Universal Credit (UC) Claimants, the amount you can earn before UC decreases was increased by £1000, which means according to Martin Lewis MSE around £600 more in the pockets of the poorest, nearly double the top rate taxpayers got (those top rate taxpayers also lose their Child benefit and those over £100,000 lose their personal allowance, their loss has gone up because the p.a has gone up.)

      • mancunius
        Posted November 1, 2018 at 12:57 am | Permalink

        In the meantime Bruce Newsome has posted an article on Comment Central that reinforces my view. Newsome writes: ‘I am betting the budget was meant to blackmail Conservatives into her fake Brexit (…) lest Philip Hammond returns to austerity in order to pay for a no-deal Brexit, for which the electorate would punish Tory MPs with slimmer majorities than his.’

        I hope JR and his colleagues are being super-vigilant about forthcoming brexit ’emergency announcements’.

  27. Steve
    Posted October 30, 2018 at 8:59 pm | Permalink

    An excellent article Mr Redwood.

    On the matter of the £39bn, I am starting to think those who insist we owe that money to the EU must be pro Europeans trying to push another aspect of project fear.

    It won’t wash with me.

  28. rose
    Posted October 30, 2018 at 9:05 pm | Permalink

    I am very relieved you managed to persuade him to raise the thresholds rather than raising tax. A pity he couldn’t have got rid of stamp duty. This reform is long overdue as a means of helping young people to move into old people’s houses which might then become vacant.

  29. A.Sedgwick
    Posted October 31, 2018 at 9:20 am | Permalink

    A little tongue in cheek I suggested pre budget Hammond should increase basic tax relief by £5000. Instead he has increased the higher level disproportionately. This shows how out of touch he is and politically inept. My “extra” £130 will not even cover 2018/9 Council Tax increase. Apart from the wow and feel good factors of a £5000 increase it would counter some of the Universal Credit angst and some savings could accrue there.

  30. John S
    Posted October 31, 2018 at 9:21 am | Permalink

    I believe this is an irresponsible budget. We need to change the deficit into a surplus or the £2t debt will be £3t before you know it. Before chucking anymore money into the NHS or education and the like, I would like to see the worthless non-jobs eliminated. Do we need diversity and equality coordinators?

  31. a-tracy
    Posted October 31, 2018 at 3:42 pm | Permalink

    John, ask The Treasury to set up three giving donation sites:

    English National Health Service
    English Education
    Benefits System

    Similar for the Scottish, Welsh and Irish.

    Those people like Sarah Woolaston, Polly Toynbee, Yvette Cooper and so on, then get an opportunity to give their tax saving back from April 2019. As Yvette didn’t realise the saving was less than £800pa she can happily give £266 to each of the three above in equal measure.

    Promise that the money will be spent only on those services.

    Make it easy to pay and give the ability to take the saving monthly rather than a one off payment up front.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

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