April’s toxic brew of showers, sleaze and sensations
APRIL is one of the weirdest months for our politicians and the public. It is the month that taxes, tariffs and regulations change. On the first Thursday of May, there are usually local or Mayoral elections. This year there are elections all over the North East and politicians get mouthy, gotcha stories abound and hyperbole is heard in every soundbite.
Let’s start by looking at those annual changes, some make people better off, some hit wallets hard. On the positive side people in work received a National Insurance cut, it’s come down 4% since New Year with a family with two earners on the average salary will be better off by £1,826 than before the cut.
Next, the state pension has gone up by 8.5%, thanks to the triple lock policy which gives a rise of earnings, inflation or 2% whichever is the higher, this time it was earnings. People on the National Living Wage will see a large rise of £1.02 per hour to £11.44 per hour. Benefits have also risen by 6.7%, at a time that inflation has fallen to 3.4%. People can also expect to see a fall in their energy bills with the energy price cap coming down, resulting in average savings of £238.
Regulation and tariffs also cause costs to go up. Ofcom regulates prices, or imposes charge controls, across a number of different segments covering the telecoms, broadcasting and postal services markets, as a result of previous decisions many broadband and phone bills have gone up by 8.8% this month. Road tax has risen by £10 for most cars, and the TV licence has gone up by £10.50 to £169.50. Council taxes have increased by around 5% and water bills by an average of 6%. Although National Insurance has been cut, the point at which we start paying tax has now been frozen for four years, which is a notional tax increase.
In general, the data suggests the economy is improving significantly, the recession that we technically entered at the end of 2023 is widely expected to be over when data is released covering January to March. All this is yet to be felt in households, but it should gradually start to filter through – for example fixed rates for mortgages have started to come down in anticipation of interest rate cuts which are expected later in the year. The internal Conservative Party debate has been about whether to cut taxes faster and deeper, but Rishi Sunak has pursued a sober and steady policy of modest tax cuts, attempting to control public spending and reminding his fellow politicians that the Government is spending billions more than it is getting in tax, even though the tax burden is at record levels. Steady and sober can also mean boring, but it is better to be boring and right than exciting and wrong. Labour has not really offered a credible alternative to Rishi’s approach. The public spending deficit was caused by Covid policies like furlough and energy support policies like the Energy Price Guarantee. No opposition politician complained that people were helped by these policies, but all are willing to attack the Prime Minister over the budgets needed to pay for them.
April is also full of showers, smears and sensational revelations as the political parties leak things about opponents and go into full on attack mode; from Angela Rayner’s council house sale to William Wragg’s honeytrap texts, the front pages are filled with soap opera and comment masquerading as fact. The big political figures take to the airwaves for keynote interviews (and podcasts) and trivia such as Rishi Sunak’s trainers or Keir Starmer’s weight get debated alongside NHS waiting lists and the unemployment data.
Lost in this toxic brew are the debates in our local communities. In The Journal’s area two mayors are going to be elected in the North East and Tees Valley and, as Ben Houchen has proved so far in Teesside, mayors can make an enormous positive contribution to the growth and vitality of their area. There are also elections for Police and Crime Commissioners. All these are really important posts but they get lost in the cacophony of other things.
One of the noisiest of noises off are always the opinion polls. The front page of the national newspaper I read showed an opinion poll that said the Conservatives would be wiped out, with fewer than 100, then last Thursday at the bottom of page two it had a later poll showing Labour’s lead had shrunk by 3% with Conservatives up by 3%.
As a lifelong Conservative I have my own views of how the Government should operate now, which include prioritising defence spending increases beyond the 2.5% of GDP already pledged, but it is far better to try and engage in honest debate about the policies on offer from all parties.
Soon the media will have to scrutinise Labour’s proposals. Will their proposed employment laws and trade union reforms make it harder for businesses to employ people? Will they have enough money to pay for their pledges? Will Labour’s policies on taxing capital gains deter investment? If Labour put tax on private education, will it cause more pupils to flood into state schools?
April is a short month to air all these arguments, but do not worry, there will be another election in November, so if you thought it will stop in May, April fool!
Graham Robb is Senior Partner in Recognition Public Relations.