Last autumn, I sat with Labour’s Harriet Harman and Ayesha Hazarika in the peers’ gallery of the House of Commons to watch Rachel Reeves deliver her second – and what proved to be final – Budget.
We got there early and observed one of the most jaw-dropping political spectacles in recent memory. A flurry of activity started from a small knot of journalists in the reporters’ gallery and spread to every scribe in the place. Then, a rustle on the opposition benches, followed by the Government.
A junior Treasury minister passed their phone down to the chancellor and a slew of handwritten notes were sent forward to Kemi Badenoch as she hurriedly started amending her response to a Budget that hadn’t yet been delivered, but whose contents had been accidentally splashed all over the OBR’s website 40 minutes early.
As Budget disasters go, Rachel Reeves was undone before she even stood up.
Budgets more usually fall apart after they are delivered, rather than before.
Chancellors Hugh Dalton and Kwasi Kwarteng were both shown the door following their Budget delivery – Dalton for leaking details of his own measures to a journalist on his way into the chamber, Kwarteng for sending the markets into a spin with unfunded cuts.
There have been a couple of near misses. Gordon Brown provoked uproar among colleagues in 2007 when he abolished the 10p starter rate of income tax. Designed to fund a cut in the basic rate, it was seen as an attack on low-paid workers and his backbenchers forced his successor, Alistair Darling, into a multibillion-pound U-turn to compensate those affected.
Conservative chancellor Kenneth Clarke’s attempts to raise tax on domestic fuel from 8 per cent to 17.5 per cent saw Tory rebels help vote down the finance bill. It forced Clarke back to the Commons the next day with an emergency statement scrapping the measure and explaining how he’d plug the £900m shortfall it had created.
But the slowest car crash I have ever watched was early on in my tenure as leader of the Conservative Party in Scotland. I had been in the job for about a year and was sitting in my Holyrood office watching George Osborne deliver his third Budget as chancellor in the coalition government. The first two had been big-picture affairs.
Following on from the financial crash, there were broad measures designed to stimulate growth, such as cutting corporation tax, raising the personal allowance and incentivising research and development.
But in 2012, there was a change of tack. Always one of the more “political” chancellors, Osborne had clearly decided that he was going to show the nation that he had an eye for detail, along with the sweeping narrative of getting the public finances back on track.
Indeed, I remember being impressed by the argument laid out to simplify the UK’s tax code, smoothing odd anomalies and closing loopholes. Why was it that hot takeaway food like fish and chips had a different VAT rating to a takeaway pie or sausage roll?
And why on Earth should the touring caravan you hitch your car to have zero VAT while a motorhome, which did the same combined job, incurred an extra 20 per cent? These seemed like perfectly reasonable changes to make.
But the thing about Budgets is not just that a chancellor has to explain – simply – what the change they’ve proposed will do, they also need to explain why they are doing it, who it benefits and what it will either cost or raise in cash terms. They can reassure the public that it is either helpful or necessary, but it also has to survive contact with opponents and with the media.
That means somebody, or more likely, a group of somebodies, close to the chancellor kicking each proposal around as hard as they can. How can our opponents attack it? Where are the areas of weakness? Do they have a point?
Osborne seemed utterly baffled that suddenly putting up the price of the baked goods enjoyed by millions of Britons each day might be devastatingly unpopular. Similarly, that whacking 20 per cent on the price of a caravan would outrage a particular slice of the country who prefer the pitches of the Lake District to a week in Tenerife come holiday time.
And so the “pasty tax” and “caravan tax” were born and added to the narrative that the Osborne-Cameron axis at the top of government were out-of-touch elites. Both born into money, they were using a Budget to hammer the small enjoyments of working folk, while in the very same Budget cutting the top rate of income tax from 50 per cent to 45 per cent.
The U-turns were as painful as they were inevitable.
John Healey won’t get a second shot at delivering his first Budget. When he rises in Parliament in a fortnight’s time, he needs to have triple-checked his changes for any avoidable attack lines.
Curiously, there have been some tax cuts left unspoken in history. In 2000, Gordon Brown cut VAT on tampons and in 2006 extended the same relief to condoms. But there was no announcement from the dispatch box because, according to his spin doctor, Brown simply couldn’t bring himself to say the words.