#autumnbudget
Read our response to today's #AutumnBudget
https://writersguild.org.uk/autumn-budget-2024-our-response/
Prepare for today, with Rachel Reeves Budget Bingo
phrases that score:
* difficult decisions
* hardworking families
* fiscal reset
* black hole
* investing for the future
* private public partnership
* inherited crisis
* rebuilding confidence
* infrastructure
* green transition
* balancing the books
* making work pay
* long term sick
* productivity
bonus points for:
+ soak the rich
+ Freeport's are corrupt
+ cap executive pay
+ Keynesian stimulus
Prepare for tomorrow with Rachel Reeves Budget Bingo
phrases that score:
* difficult decisions
* hardworking families
* fiscal reset
* black hole
* investing for the future
* private public partnership
* inherited crisis
* rebuilding confidence
* infrastructure
* green transition
* balancing the books
* making work pay
* long term sick
* productivity
bonus points for:
+ soak the rich
+ Freeport's are corrupt
+ cap executive pay
+ Keynesian stimulus
If you're in the UK, you don't need me to tell you that Labour's first budget will be laid out by Rachel Reeves on Wednesday...
Ignore the narrative & the claims... there's only one thing you need to do to understand how Labour's next year(s) will proceed:
FOLLOW THE MONEY
ha ha ha.... looks like Jeremy Hunt is about to be shafted by the OBR.
Make enemies while you're in Govt. see them stitch you up when you're in opposition....
I so hope they do a really good job on budget day of skewering the self-satisfied little b*stard!
Great letter from Professor John Muellbauer in the FT, on why Rachel Reeves recalibrated fiscal rules should include land values held by the state.... and how this could then be used too help fund Angela Rayner's plans for the expansion of social housing....
![[edited due to word limit in Alt Text - but second half of the letter is where the action is]
It would be a grave mistake to exclude saleable land on the government’s balance sheet when netting off from gross debt. Such an exclusion would critically handicap the implementation of better land value capture, strongly signalled in the Labour election manifesto, and have a crucial impact on whether the government is able to achieve its ambitious housebuilding targets.
One precondition for better land value capture is the repeal of the 1961 Land Compensation Act. The other is a new fiscal rule. Public authorities should be able to borrow to buy land at prices below those that would apply to land that had planning permission. After obtaining planning permission, some of this land could be used for building social housing more cheaply than is currently possible. Some would be sold off to private developers and the profit used to fund infrastructure. Overall, with land included in the assets netted off, net government debt would fall, and housebuilding and growth rise, even though gross debt increases.
Professor John Muellbauer
Nuffield College and Institute for New Economic Thinking, University of Oxford, Oxfordshire, UK](https://cdn.masto.host/zirkus/media_attachments/files/113/373/055/213/800/239/original/38f8f36f955d8762.png)
Zombie policy ahoy:
the FT is reporting, despite their lacklustre performance as engines of regional growth in the past (and when I say lacklustre, I mean negligible), another five Freeport's look like being announced next week in the budget....
When there a real polices that could be enacted, why does our political class still think Freeport's are the 'answer' to anything (other than money laundering & tax evasion..... oh wait..)
Its a policy that just won\t die
In anticipation of next week’s Budget, we release new data on public attitudes towards taxation, spending and satisfaction with the health service.
At 48%, the proportion who say that taxes and spending should be increased is much the same as the 46% who did so last autumn.
61% feel that those with high incomes pay too little tax, more than ever previously reported.
Read the latest blog from Sir John Curtice exploring the stats. https://natcen.ac.uk/public-support-higher-taxes-remains-steady-whilst-dissatisfaction-nhs-grows
#AutumnBudget
If as Chris Giles (FT) suggests, we need to match our aspirations for a European style welfare state, with European levels of taxation (higher for everyone, not just the wealthy as often now suggested), then we hit a major political problem.
If we demand more taxes before the public sector recovers from the Tory engineered crisis, we merely build up resentment at the mismatch between cost(s) & service.
Reeves' fiscal rules must allow sufficient investment to square that circle!
As wise approach the Autumn Budget, one thing that will prove interesting will be how Jeremy Hunt pitches his response.... since the budge statement is likely to be based on a caustic & explicit assessment of his chancellorship.
Already in an interview with the FT, he's trying to find a route of supporting those things that she's sort of inherited from him, while claiming none of the problems are his fault... the hypocrisy klaxon will be sound long and loud.
The quiet irony of the economic commentator:
'Reeves is trying to find ways to close a £40bn spending gap. It is not an easy situation. Most economists would agree that measures that fuel faster economic growth will help to close that gap. What is less clear is how tax giveaways to the rich & a real-terms freeze on welfare payments to the poorest achieves that aim'.
Phillip Inman (Observer)
Come the Budget we can follow the money & discern her aim(s)
Graeme Bandeira on #RachelReeves #KeirStarmer #Budget2024 #AutumnBudget - political cartoon gallery in London original-political-cartoon.com
Dave Brown on #RachelReeves #AngelaRayner #Budget2024 #AutumnBudget #Cuts #SpendingCuts #Services #Austerity #BlackHole - political cartoon gallery in London original-political-cartoon.com
Two weeks to go to the Autumn Budget, and the press is full of kites being flown, & speculations about which groups' lobbying may have impacted on Reeves decision-making....
But, one thing is pretty clear; whatever the details this will not be the budget many people who voted for Labour hoped they might get.
The big Q. seems to be the shape of continuation-austerity.
So after the budget we'll be needing to follow the money to gauge what Labour really stands for (now).
If you're concerned by stories circulating that bond traders (the 'bond vigilantes') are warning Rachel Reeves about the (possible) tax, borrowing & spending plans - with a nod back to the Liz Truss debacle - here's @sjwrenlewis suggesting that such worries are misplaced.... because you can always find economics commentators who will make such warnings *and* because the warning itself makes little sense given the current fiscal environment.
https://mainlymacro.blogspot.com/2024/10/october-budget-6-thanks-to-truss-bond.html
As Larry Elliott argues, while Labour may need the financial services sector to help expand investment in infrastructure & new industries (although for many of us, that must be balanced by/with public investment), the danger is that the financial services influence on the UK economy has been malign & this will be compounded by making them central to Rachel Reeves plans.... however, as often pointed out, Reeves is already a financial services 'familiar'.
As we wait for the Autumn Budget, James Smith (Resolution Foundation) sets out the three challenges Rachel Reeves needs to deal with:
Ending austerity;
Funding public services;
Investing in Britain's future...
How to raise the cash?
Smith argues for raising Capital Gains Tax, National Insurance on pensions contributions, shifts in inheritance tax and (of course) rewriting the fiscal rules...
While Reeves may do some of this will/can she do ti all?
#AutumnBudget
https://www.theguardian.com/uk-news/2024/oct/13/tax-wealth-and-value-public-assets-how-reeves-can-solve-her-biggest-budget-challenges
Today Rachel Reeves submits her fiscal assumptions to the Office of Budget Responsibility ahead of the Autumn Budget's;
But her budget strategy is vulnerable to what the OBR thinks about future developments in productivity:
If they've concluded they can no longer assume continued (even anaemic) growth in productivity (as some think they have), then GDP growth predictions will be downgraded & her 'fiscal headroom' reduced... further constraining her plans.
#AutumnBudget #productivity
h/t FT
If 'bond vigilantes' are a major concern for Rachel Reeves ahead of the Autumn Budget, then a spike in long-term govt. debt (10 year Gilt's yield) in relation to the yield for German public debt may be 'difficult'!
After the Liz Truss debacle the gap rose to an over 2% 'premium', and right now while not quite reaching that level is approaching it....
How to read what Bond traders concerns are, however, is a different matter.... still Reeves will be watching the trend.
#AutumnBudget
h/t FT