Like Neo was offered (in one of my favourite films), Rishi Sunak had the chance to take the Red or the Blue Pill with this budget, which was always likely to be one of the toughest balancing act budgets in peacetime.
On one hand, we have the perilous state of the nation’s finances to wrestle with, on the other the short-termism of politics and being voted back in again at the end of the current term. (Already a snap election has been mooted as a real possibility)
Choosing the “red pill” reveals an unpleasant or otherwise life-changing truth, and the “blue pill” refers to remaining in blissful ignorance. Almost too obviously in a budget where ‘Help to Grow’ was the second key message (behind ‘I will do whatever it takes), Rishi took the blue pill. So, in a way, the majority of us have taken the blue pill with him. But then we knew that as most of the budget was leaked in advance, so it threw up very few surprises that haven’t been reported already this week.
The huge and incomprehensible scale of the national deficit was never really addressed, but then again, I guess how easy is it to address a number nobody really understands? Best to gloss over it and throw numbers around – like any of us have any idea how they all add up at the end!
So today Rishi needed to try to stem the money bleeding at a rate of over £5,000 per second from the arteries of the UK coffers.At that rate, all numbers go out of date very quickly but as I write, the number seems to be around £2,400,000,000,000 (ignoring state pension and pensions relating to state jobs like NHS, Teachers, Civil Service etc – which could easily be as much again). So, he chipped away by freezing all our allowances (saving the government money by effectively reducing them by inflation) and increasing corporation tax – especially for the bigger firms. The new ‘green bank’ infrastructure fund looks very exciting in principle and the new Super Deduction looks interesting to the firms that will actually qualify for it. Also, our previous blog ‘The Roaring Twenties’ looks still on track as alcohol duties are frozen, so we can still all-party once we’re allowed. The rest of the measures were as expected, mostly to support specific sectors through the tail end (hopefully) of this rubbish pandemic we’ve all suffered through.
Did he do it? Well, the boring answer will be ‘time will tell’ and that the devil will be in the detail. But I suspect he may well (spoiler alert) end up in the same predicament as Neo did….
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