A Resolution Budget Solution?

Just Read It

One of the great disappointments of Starmer's Labour Government is the way it has tackled its budget. If growth were the prime objective, then there have been too many ill-conceived decisions by the Chancellor. Rachel Reeves has a tendency to follow treasury orthodoxy and an unwillingness to devolve decisions to departments or localities, who have a far better knowledge of what works. The chancellor, like Gordon Brown, seems to believe that leadership is about making decisions herself. She has an autocratic leadership style that is inflexible and has resulted in heavy criticism from not only the right-wing press but also businesses and many Labour MPs. Too many decisions are constraining other key objectives of the government, such as child poverty, climate action, international aid and employment growth. 

Existing taxation regimes are made ever more complex when what is needed is simplification. A decluttering of the stupidity of many VAT rules and the regressive outcome of the dual impact of income tax and national insurance systems, which should be integrated. Thousands of accountancy firms exist to find loopholes for the better off in a taxation system that is far from progressive even before the annual dance off between HMRC and the said accountancy firms. 

So I was greatly encouraged when Torsten Bell was recruited to work with the Treasury team on economic policy. Torsten Bell had worked with Alistair Darling during the last Labour Government when he made significant progress on firing up the economy after the 2008 Financial Crisis. His initiatives were scrapped by George Osborne when he introduced his austerity measures. Bell subsequently worked successfully as the CEO of the Resolution Foundation until being elected as an MP for Swansea. He published a book last year, Great Britain? How we get our Future back. that set out his views on what we needed to do to get Broken Britain moving again. His chapters on taxation, housing, benefits, decentralising power and increasing public investment are particularly apposite, but not aligned with Rachel Reeves' playlist of actions. It will be a real boost for Labour's so-called agenda for 'change' if Torsten Bell can convince the inflexible chancellor to do just that.