Budget 2017 Preview

38-budget-case-getIt is Budget time – again. Not that you’d know it from the newspapers who are yet again
distracted by another Jeremy Corbyn gaff. But we here at Chelgate can see through the bluster and the headlines to focus on what is actually important.

This will be the first Budget of the Theresa May-era and the Chancellor’s earliest opportunity to undertake some preparation for Brexit. It is also worth noting that this is only the second Budget delivered by a Conservative-majority Government.

Unlike his predecessor, Philip Hammond is not flashy. The big announcements and gaudy gimmicks George Osborne used to declare his Budgets are probably a thing of the past. The Prime Minister has a lot riding on this. It is an opportunity for her, and her team, to truly close the door on the Cameron Project.

Hammond is not renowned for his enthralling rhetoric, but he is known as being a safe pair of hands. Transport, Defence, Foreign Office – he administered all of them scandal-free. But Chancellor of the Exchequer is at a different level – it is the second biggest of the four Great Offices of State – so his performance will be carefully scrutinised.

As ever, behind closed doors politicians are gossiping about what we can expect. Aside from the usual Budget business we will not be surprised to see:

  • A sharp upgrade to the UK’s growth forecasts
  • More spending on transport infrastructure
  • More spending on increasing the number of free school places
  • More spending on technical education and digital industry
  • A number of stealth measures to fund the deepening social care crisis including:
    o Small firms hit by business rates hikes
    o Tax increases for the self-employed
    o An increase in alcohol duty
    o An announcement on changes to stamp duty
  • A reduction in the country’s borrowing forecast to build up a Brexit war chest

There may also be some thoughtful, and politically clever, mid-term sweeteners thrown in to the mix. Despite it all seemingly going well for Team May the next political hurdle is the upcoming County Council elections – where the social care crisis could come to the fore. The debacle in Surrey over whether to have a referendum on a 15% increase in council tax, and whether there was a ‘special deal’ with the Government to scrap it, is a good example of this. Any stumble here will be picked up by the media as a reflection on the Government’s strategy on Brexit, no matter what the real reason.

We expect a lot from this Chancellor’s first Budget. In a similar vein to how Theresa May ran the Home Office there are very few leaks to go on, so there may yet be some interesting surprises tomorrow. Of course, Chelgate will provide some post-Budget insight so that you don’t miss what is important.

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