This is Big Phil’s chance to show he is a champion of a fair society

THE Chancellor does not need to abandon the plan for deficit reduction. It is still crucial to achieve a structural budget surplus.

In this year’s election the Tories stopped arguing about the necessity of fiscal retrenchment. Instead, they ceded to leftist arguments about the current market economy only working for a privileged few.

But Big Phil has to be bolder. It is perfectly possible to better and radically distribute public spending within the current fiscal framework.

Higher-rate tax relief on pension contributions, the triple lock on the state pension: chipping away at these would save billions. As would suspending the rise in the tax-free allowance for income and inheritance tax, and the threshold for higher-rate income tax. There are more pressing needs: decreasing recruitment of nurses and teachers, unaffordable housing and poor social care.

The Conservatives are on the back foot, announcing policies only in response to Labour’s campaigning. Funding 25,000 new social homes and a freephone number for Universal Credit are sensible moves but too reactive and modest to make a difference to sceptical voters.

Having an economic vision that is solely about deficit reduction, however, is not enough against passionate Corbynism. A new narrative is needed, which explains to voters why the Government is implementing the policies it is.

The Chancellor should show he wants to reward those who contribute economically, socially and environmentally. This is quintessentially conservative. It chimes with the public perception of fairness: not greater economic equality but financial rewards being more linked to people’s efforts.

The priority should be those working for poverty wages. Raise the threshold for paying employees National Insurance. Introduce supplements in Universal Credit and Statutory Maternity Pay to reward those with longer work histories.

Young people saving to get on the property ladder deserve more help. Cut punishingly expensive stamp duty for nearly all first-time buyers.

The Transferable Tax Allowance should be increased and extended to all those on basic rate tax, not just married ones. Let grandparents shift their tax allowance to their adult children if they leave a job to look after grandchildren.

Behaviour that is not contributing should be the target of tax rises. Extend the sugar tax to all food and drink products. Apply new taxes to diesel cars and single-use plastics.

The Tories should show they are the champions of economic, social and environmental responsibility.

Ryan Shorthouse is the director of Bright Blue