In 1947, Hugh Dalton had to resign as Chancellor of the Exchequer because minutes before delivering his Budget speech, he had let slip to a journalist that certain taxes would be changed, causing that story to appear in the evening papers while he was still speaking and before he had informed the House of Commons. These days, readers and MPs alike would count themselves lucky that it had been true, since not only has the Government already announced five new freeports to the media, but those turn out never to have existed at all.

On Monday, Keir Starmer’s harsh light of fiscal reality bent around the £22 billion black hole of Rachel Reeves to reveal an extra £1.4 billion for schools, or a whopping 50 grand each; £500 million for social housing, enough to build a couple of thousand homes; £240 million to help people back into work, or about 80 quid for each person currently jobless; and a 50 per cent increase in bus fares.

All on the day that Sir Lindsay Hoyle read the riot act over the announcement of policy in the media before its announcement to the House. Today, he should name both Starmer and Rachel Reeves, requiring them to leave the House immediately and not return for the remainder of the day’s sitting. No Prime Minister’s Questions that day. And no Budget speech, effectively daring the Government to publish it anyway and see what would happen.

The national minimum wage goes back to 1998. It has increased since then, but by nothing like the increase in economic output per hour worked in the United Kingdom; in short, productivity. This is underpayment on a colossal scale, and underpayment is theft.

When the minimum wage goes up by 77p per hour, then 15.4p will be deducted from that in income tax, and 6.16p in employee’s National Insurance contributions. There will be a tapered deduction of up to 55 per cent in Universal Credit, and a fiscal drag of 2.5p due to the freezing of the Personal Allowance. So a full-time worker on minimum wage will keep fully 22 of those 77 pennies. £1.76 per day.

But wait. Her bus fare will be going up by two pounds per day, one pound to get her to work and one pound to get her home, leaving her 24p per day worse off even before things like the huge increase in energy costs, all under a Labour Government that had inherited an economy that had grown by £29 billion in the first six months of 2024, after which growth in Gross Domestic Product has simply ceased.

From the RSA website:

‘Producer capture’ is one of the key concepts imported by New Labour from the nostrums of neo-liberal economics. It describes the process whereby the goals of an organisation reflect the interests and prejudices of its employees (the producers) rather than those it is supposed to serve (the consumers, customers or citizens).

I’d argue that the NHS is one such organisation, that machine politics is another set of examples, and the two main political parties are currently intensely focused inwardly on internal struggles.
As a consequence our politicians have no interests in ‘vision’ or ‘goals’ beyond providing ‘status points’ in their party struggles. The views of the electorate are an embarrassing distraction from the ‘real business’ of politics.

It’s disappointing how impoverished the debate over taxes and benefits is. There are some points which, whatever one’s position on them, really need to be a well-understood part of the public discourse.

There are three main reasons for levying taxes. (1) To raise the revenues needed to run the state’s functions and services; (2) to redistribute wealth from people who are well off to people who aren’t; (3) to penalise and discourage unwanted behaviour. Is it really impossible for a Chancellor to state which taxes, current or proposed, fall into which category?

There are two main ways of distributing benefits. (1) As of right, universally, or on the basis of universal criteria such as age; (2) to selected recipients. This has been true ever since the introduction of benefits, no later than Lloyd George’s Old Age Pension in 1909. The pros and cons of each method are rediscovered by every chancellor as if they were entirely novel. Had they really not thought about them beforehand, and come prepared to articulate their chosen position?

 “The noises from the Conservative leadership contest signal little more than a desire to relitigate culture wars and restate commitments to a deregulatory agenda and small-state, low-tax principle”
Well that’s largely what I want. Much more, of course, but, although I think Jenrick is mostly noise, Badenoch is more. Much much more. And is the only person I can see in UK politics today with the gumption to fundamentally change things for the better.