This is a sometimes 'cheesey' blog about British and American politics and anything else which tickles my fancy!
Tuesday, 23 March 2010
What would I like to see in tomorrow's Budget?
Tomorrow marks Alistair Darling’s third Budget as Chancellor. Like many people in the Labour Party, I think Darling has done the best possible job he could have under very difficult circumstances.
Two years ago, when he predicted that this would be the worst economic crisis for 60 years, he was widely denounced (even by his colleagues in Number Ten) but in the end he was vindicated. He is now a more credible figure for it.
Tomorrow he faces one of his toughest tests. He made most of his announcements about tax and spending in last November’s Pre Budget Report so he has left himself very little wriggle room now.
Therefore, tomorrow’s Budget is likely to be narrowly focused with relatively few new measures. He should certainly steer clear from pre-election ‘give-aways’. Voters will see through them.
Instead, he needs to show the public and the markets how the Government will nurture the economy back to growth.
There is likely to be some extra revenue from the bank bonus tax. He should use this to pay down the deficit and introduce new measures to alleviate unemployment.
He should announce a Green Investment Bank to stimulate low carbon industries in the future. Sometimes government support can kick start private sector investment. This is surely the right thing to do and something Thatcherites have never understood.
A serious crackdown on tax evasion is long overdue. It’s essentially about fairness and paying your way.
Finally, if the Chancellor wanted to be really radical the closest he could come to a game changer is to announce support for a Robin Hood tax on all financial transactions. This would raise revenue and help repair the damage to the public finances. France and Germany favour this approach, so does the economist Jeffrey Sachs. Apparently, Richard Curtis and the actor Bill Nighy have already met with George Osborne to discuss the issue so why not come out strongly for it? Radical by any standards but entirely fair.
This might be the last Budget a Labour Chancellor delivers for a long time. Mr Darling should treat it as a final opportunity to show voters the Government is on their side.