A Budget to reward Britain’s strivers

THIS was the day Eeyore transformed himself into Feelgood Phil.

Chancellor Philip Hammond – normally regarded as an incurable pessimist – emerged from his dark and gloomy place with a Budget designed to spread a little sunshine.

There were even jokes (mostly awful) as he revealed optimism for the future. Thanks to the hard work, perseverance and sacrifices of this country’s ‘strivers and grafters’, he proclaimed that Labour’s recession – and the austerity needed to rectify it – were ending.

This was a Tory Chancellor unafraid to trumpet his party’s achievements over the past eight years. An employment ‘miracle’ has seen 3.3 million jobs created across the country. Wage growth is at its highest in almost a decade and predicted to grow in each of the next five years. And income inequality is now lower than at any time under the last Labour government.

The benefits of this economic turnaround were to be spread across the board. And because spending and borrowing had been brought under control and the ‘jobs miracle’ had massively increased tax receipts, Mr Hammond was able to inject much-needed funds into key areas.

With a whopping £950million extra being sent his way, Scottish Finance Secretary Derek Mackay’s complaints about being ‘short-changed’ sounded like baseless complaints being read from a pre-prepared script. Mr Hammond raised income tax thresholds, putting money into the pockets of 32million workers.

Will Mr Mackay, in his December Budget, similarly pass on the rewards for years of belt-tightening, or will he increase the ‘progressive’ tax gap that means Scots are saddled with the highest tax rates in the land?

Certainly facing steep tax rises will be web giants such as Amazon (in the form of Mr Hammond’s turnover-related digital services charge) and manufacturers of unrecyclable plastics.

Our ailing high streets received desperately needed help, there was a boost for the NHS and £1.7billion was earmarked to deal with problems in the roll-out of Universal Credit.

There was cash for defence and the Chancellor continued the freeze on the fuel duty escalator.

Whisky, a key employer and exporter for Scotland, was protected thanks to effective lobbying by the Scottish Tories.

As ever, there are caveats. Under previous forecasts, the deficit was supposed to be eliminated by 2025. But Mr Hammond admitted that in 2023-4, we will still be borrowing £19.8billion. The chances of that being reduced to nothing in a year seem slim.

Our national debt already stands at a terrifying £1.79trillion, costing £48billion a year just to service. Racking up more debt to splash on public spending would be a deeply imprudent course.

However, Mr Hammond assures us that reduction targets have not been abandoned and we should give him the benefit of the doubt. The OBR showed little concern over the continuing deficit yesterday and confirmed that our national debt as a proportion of GDP peaked in 2016-17 and is due to fall steadily over the next five years.

And let’s just consider the alternative – the spectre of a Labour government.

The prospectus of Jeremy Corbyn and shadow chancellor John McDonnell would undo all the good work of the past eight years in a matter of weeks. By some estimates, their spending commitments would require an extra £1,000billion in borrowing.

This Budget was intended to show middle Britain that all their graft had paid off and that we are emerging from the deepest recession since the 1920s. But there is one more obstacle to overcome before that vision truly becomes a reality. Mr Hammond made clear that if Britain crashes out of the EU without a deal, our prospects would take an immediate and calamitous turn for the worse.

This paper has argued that the Tory saboteurs and back-stabbers trying to undermine Theresa May in her quest to achieve the best Brexit deal are dragging this country towards the abyss. Will they now finally put their country first?