New Times,
New Thinking.

  1. Politics
8 March 2017

Budget 2017: Jeremy Corbyn’s listless response let Philip Hammond off the hook

The opposition leader may yet come to regret his failure to hammer the Chancellor 

By Patrick Maguire

Philip Hammond’s threadbare budget broke a key Tory manifesto pledge and offered little substantive engagement with the biggest challenges facing the economy (neither the Chancellor nor the Treasury’s Budget book mention Brexit once) – but the leader of the opposition still failed to land a decisive blow. 

The critique that made up the bulk of his response – that the Chancellor’s statement betrayed a dangerous complacency on government’s part, that public services had been handed an ever rawer deal than before, that not enough had been done to alleviate the crisis in the NHS and social care system – was, for the most part, a valid one. But, as ever, Jeremy Corbyn’s response was shouty and diffuse and displayed little substantive engagement with the Budget itself. 

Most conspicuous was the Labour leader’s failure to attack Hammond decisively on what will likely prove to be the most contentious change made in today’s Budget: the hike in Class 4 National Insurance contributions for self-employed workers making more than £16,250 a year. Corbyn’s line on the changes was oblique at best: “We have long argued to clamp down on bogus self-employment but today the Chancellor seems to have put the burden on self-employed workers instead “. Despite Treasury denials, the early consensus is that this is a straightforward broken manifesto promise: Hammond’s giveaway-prone predecessor, George Osborne, pledged in 2015 not to raise national insurance contributions. The pledge, as Corbyn’s deputy Tom Watson has pointed out, appears in their manifesto four times. 

This unforced strategic error is compounded by the fact that the hike was trailed in the press days before the Budget. Nor can the glaring omission from Corbyn’s speech be put down to agreement with the policy: John McDonnell, the shadow chancellor, has since tweeted that Labour “will oppose the £2 billion Tory tax on self employed low and middle earners”. Regardless of whether or not the NI increase is something to be welcomed – plenty of thoughtful economists on the left, such as those at the Resolution Foundation, think so – Corbyn has no excuse for not mentioning it explictly.  

Exasperated Labour MPs may well find some small solace in the fact that the backlash to the NI increase is barely out of first gear. But Corbyn’s missed equals anonymity. Hammond will likely face a sustained offensive from the noisier corners of the tabloid press: on Saturday, the Sun accused him of “targeting White Van Man” and staging a “cash grab” on the self-employed. Whatever the trajectory of this policy, it is Tory MPs and the right-wing press who pose the greatest threat to the government – as, arguably, was the case with the controversial changes to tax credits in 2015 – and who will claim any victory.

Hammond’s percieved betrayal of the just-about-managings he and the Prime Minister profess to govern for might well prove a costly political – if not economic – mistake. So too could Labour’s failure to own it. 


Content from our partners
An innovative approach to regional equity
ADHD in the criminal justice system: a case for change – with Takeda
The power of place in tackling climate change