The real impact of the budget on the public

by Peter Watt

The thing about big political events is that they generally aren’t big events in the same way that, say big sporting events or a royal wedding are.  The latter are things that most people are aware of and that get people talking.  Big political events generally do neither.  But they certainly feel like really big events if you are a political junkie or you are working inside the political world.

I can remember when Labour Party HQ used to buy all of the staff ice-creams on budget day; it was a bit of a tradition.  In the weeks building up to the day itself there would be mounting excitement.  Briefings were prepared and printers were primed to start printing materials within minutes of the end of the budget so that local campaigners were ready for their weekends work. Because the point was that budgets were big, game-changing, or game re-enforcing events.

Except looking back, they generally weren’t, and very little actually changed.  The polls might blip but they soon blipped back to where they were before.

And I was reminded of this yesterday; because I, along with every other political obsessive, had enjoyed this last week.  The NHS Bill skirmishes and the budget briefing.  Both had left us all with plenty to read, discuss and tweet about.

For instance I had several really enjoyable ‘discussions’ with some fellow comrades on twitter who felt that I was basically class traitor of the week.  My crime?  Being mildly critical of Labour’s “save the NHS” campaign.  So, all in all, it had been a great build up to the budget with lots of politics in the air.

It felt like it was going to be a big one and the commentariat and kremlinlogists were in full cry.  Who was calling the shots, the Lib Dems or the Tories?  Would George do in the 50p tax rate?  How would Labour respond?  I am sure that at Labour Party HQ the ice-creams were stocked.

But then reality kicked in and I found myself in back-to-back meetings on budget day itself and then had to work late.

So I missed all of the coverage.  As I left work I hadn’t seen the red-box shots outside number 11.  I had no idea what George had to drink at the despatch box or for how long he had spoken.  And, apart from the odd detail that I had seen flash up on my iPhone in-between meetings, I had no idea what had happened.

I felt slightly out of it and discomforted.  It was a bit abnormal and odd that I didn’t know the result of the great decisions being outlined (or confirmed) at Westminster.  But then it sort of dawned on me:  the vast majority of the population would be in the same boat and couldn’t give a fig.

They would have been leading their lives, going to work, looking after the kids, doing DIY or whatever.  They were not hanging off every word of the budget.  They might have caught a snippet at some point, but plenty would only have had a vague notion that the budget was on and plenty more would have had no sense of it at all.

This huge political event wasn’t really that at all.  It was a fringe activity at best.  We might pretend that it was a pivotal moment in the deciding of the next general election.  But it really wasn’t.  Because, as is the case in most “big” political events, nothing has really changed.

On Wednesday morning the Tories were seen by many voters as a party that was generally a party of the wealthy.  They were not seen as being in touch with “ordinary” people’s lives.  By Wednesday evening all of that was still true.

On Wednesday morning Labour were seen by many voters as a party that was not to be trusted on the economy.  By Wednesday evening that was still true.  And the Liberal Democrats were still seen as the junior partners in a Tory Government.

And over the next few days there will be a bit of a spat.  The Tories will try and say that they are really not just a party of the rich by pointing out the stamp duty changes on very expensive houses.  Labour will goad them by saying that they chose to cut the taxes of the rich rather than protect the tax credits of the poor, and no doubt, the Tories will feel uncomfortable.

Labour will try and say that they would have been much more economically literate by prioritising growth over tax cuts for the rich.  The Tories will goad them by asking them if they would reverse the decision on the 50p tax rate and Labour won’t answer and will no doubt feel uncomfortable at how evasive this looks.  And the Lib Dems will try and say that they have nearly achieved their goal of a £10,000 tax free allowance but in reality will still be the junior members of a Tory Government.

But nothing will really have changed because people make their mind up about who they will vote for over a very long period.  To win an outright majority the Tories will probably need more people to feel that they are on their side and the truth, is that the 50p decision probably hasn’t helped but it is not fatal.

Labour needs people to feel that they are credible economically but a few weeks of goading the unfairness of the Tories probably won’t help that, even if it feels good.  What they do need to show is that they can take difficult decisions on spending and that they can govern with little money to spend.

The Lib Dems need people to feel that they can punch above their weight and make a real difference as the junior member of a government. But the 50p decision will probably make them feel uncomfortable and so they will need to deliver some real meat over the next few years, which should make for interesting times within the government!

So these deeply felt perceptions can take a long time to change.  The parties are running out of time before the next election, if they seriously want to change them.  And I strongly suspect that the budget this week will not really have changed many people’s perceptions very much at all.

Peter Watt was general secretary of the Labour party

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6 Responses to “The real impact of the budget on the public”

  1. Anon E Mouse says:

    Peter Watt – bang on the money once again.

    The NHS nonsense from Labour has made them look foolish as will their protestations about this budget. With the majority the government has in the commons why can’t Labour choose causes it might actually win or offer a believable message and be consistent?

    We know they ran up the bills and no matter how many times they drone on about Global Economic blah blah we will not listen because we know hogwash when we hear it.

    No one likes to be told they’re wrong about something – especially by the very individuals they blame for the same problem.

    Who actually runs “Labour” I wonder because they are a complete and utter shambles at the moment….

  2. Joe Roberts says:

    I am actually surprised by this article. I was expecting that Peter would be praising the Coalition to the heavens for boosting wealth creation by cutting the 50p rate, and condemning Ed Miliband’s heresy in opposing it!

    Then again, I imagine that Rob Marchant or Dan Hodges will be along soon enough to big up Osborne’s budget!

  3. Dan Hodges says:

    …great budget I thought…

  4. Don Gately says:

    “as is the case in most “big” political events, nothing has really changed.”


    however these events can be much more important in the long run. Brown’s 10p tax screw up ended up playing a role in the 2010 GE – more so than it did in the day or two after that particular budget.

    Now part of the reason that happened was that people wanted a stick to beat brown with and looked back at his record. When 2015 comes opponents of the coalition will be doing the same – the granny tax might form such a stick (frankly rich pensioners should pay more tax imho though). It’s not an issue of whether this plays politically now but more one of whether it’ll play in 3 years. Although I’d guess that there will be much bigger sticks lying around by then looking at the way the coalition makes policy.

    the problem labour has is that we’ll probably get a heavy kicking ourselves the way we’re carrying on. We really ought to get a strategy at some point and shouldn’t be waiting until autumn 2015 for that to happen

  5. Forlornehope says:

    Labour needs to have the guts to declare that it will take a larger share of national income to spend on services and benefits than the coalition. It also needs the guts to explain that it cannot be done on borrowed money or just by taxing the rich. Everyone on or above median income will have to pay more tax. That’s the route back to credibility but there seems to be precious little appetite in the party to take it.

  6. Any decent budget is responsive to the economic facts on the ground. This one manifestly fails on this count.

    The theory behind drives to ‘localise’ national pay structures for public sector workers (i.e. teachers et cet) is based purely on neo-liberal theory. So the theory goes, if you cut the public sector, the private sector fills the void and is more efficient. This isn’t the case, as we can see with the crumbling austerity programme nationally.

    Then there is the kicking of the pensioners in the goolies to fund the tax cut for the wealthiest. Again more neo-liberal theory far removed from hard economic facts.
    And the facts are, the more socially mobile you are as a society, the higher the social cohesion, and the stronger the economic performance. Love China or hate China for human rights records, they have lifted over 2 bn of its citizens out of absolute poverty via redistribution. The trickle down effect was always bunkum.

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