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You can find the current article at its original source at https://www.theguardian.com/commentisfree/2016/nov/23/the-guardian-view-on-philip-hammond-he-will-take-far-more-than-he-gives
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| The Guardian view on Philip Hammond: he will take far more than he gives The Guardian view on Philip Hammond: he will take far more than he gives | |
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| On any other day, the raft of measures announced by Philip Hammond just after midnight would not be a mere teaser for this afternoon’s autumn statement: they would be the main event itself. A ban on letting-agent fees; an above-inflation jump in the minimum wage; an extra billion for new homes; more cash for families claiming universal credit: any one of these policies would be natural fodder for the front page. Yet here they are all bundled together on one Treasury press release with a few more stocking-fillers for good measure. These follow briefings about an extra billion for new roads, more money for research and development and the latest attempt to roll out superfast broadband. One may wonder how Mr Hammond plans to surprise MPs this afternoon, beyond the revelation of an even bigger black hole in the public finances – caused by Britain leaving the EU, the economy growing slower and tax receipts plummeting. But those aren’t the sort of headlines any chancellor would relish. | On any other day, the raft of measures announced by Philip Hammond just after midnight would not be a mere teaser for this afternoon’s autumn statement: they would be the main event itself. A ban on letting-agent fees; an above-inflation jump in the minimum wage; an extra billion for new homes; more cash for families claiming universal credit: any one of these policies would be natural fodder for the front page. Yet here they are all bundled together on one Treasury press release with a few more stocking-fillers for good measure. These follow briefings about an extra billion for new roads, more money for research and development and the latest attempt to roll out superfast broadband. One may wonder how Mr Hammond plans to surprise MPs this afternoon, beyond the revelation of an even bigger black hole in the public finances – caused by Britain leaving the EU, the economy growing slower and tax receipts plummeting. But those aren’t the sort of headlines any chancellor would relish. |
| Nevertheless, this is an exceptional flow of news, especially considering that it comes from a chancellor who claims to dislike big autumn statements. So much for the new politics. In 1947, then-chancellor Hugh Dalton was heading into the chamber to deliver his budget when he blurted out details to an evening paper reporter, on the assumption (it is often said) that it was too late to go to press. The list – “No more on tobacco; a penny on beer; something on dogs and pools but not on horses” and so on – was being sold on the streets 20 minutes before Mr Dalton stood up to speak. Thus did Clement Attlee lose his chancellor. What was once a resigning matter is now considered news management. | Nevertheless, this is an exceptional flow of news, especially considering that it comes from a chancellor who claims to dislike big autumn statements. So much for the new politics. In 1947, then-chancellor Hugh Dalton was heading into the chamber to deliver his budget when he blurted out details to an evening paper reporter, on the assumption (it is often said) that it was too late to go to press. The list – “No more on tobacco; a penny on beer; something on dogs and pools but not on horses” and so on – was being sold on the streets 20 minutes before Mr Dalton stood up to speak. Thus did Clement Attlee lose his chancellor. What was once a resigning matter is now considered news management. |
| Beyond the headlines, some big things can be said about Mr Hammond’s giveaways. The first is that while they may be considered rabbits out of a hat, they are rather small bunnies. None costs the Treasury very much money. It will not be Mr Hammond who stumps up for the increased minimum wage either, but employers. The housing money is being billed as part of a “major package” but £1.4bn spent on building 40,000 new homes makes them worth about £35,000 each. These are either going to be very cheap houses or extra money will have to be found from somewhere. Second, some of these policies come with glaring loopholes. Take the ban on letting agents’ fees: this will be popular with the 4.3m households now renting in the private sector. But the agents will get their income from somewhere: most obviously by charging landlords more, a rise that will be pushed on to – guess who? – those tenant households. | Beyond the headlines, some big things can be said about Mr Hammond’s giveaways. The first is that while they may be considered rabbits out of a hat, they are rather small bunnies. None costs the Treasury very much money. It will not be Mr Hammond who stumps up for the increased minimum wage either, but employers. The housing money is being billed as part of a “major package” but £1.4bn spent on building 40,000 new homes makes them worth about £35,000 each. These are either going to be very cheap houses or extra money will have to be found from somewhere. Second, some of these policies come with glaring loopholes. Take the ban on letting agents’ fees: this will be popular with the 4.3m households now renting in the private sector. But the agents will get their income from somewhere: most obviously by charging landlords more, a rise that will be pushed on to – guess who? – those tenant households. |
| Many of these measures will be described as jam for the “Jams” (the acronym for that demographic now referred to as the “just about managing”, but previously termed the “squeezed middle”, “alarm clock Britain” or, less poetically, “hard-working families”). No doubt some of them will be a help, especially the bump in the minimum wage and the slightly more generous treatment of universal credit claimants. But that last tweak is for one year only. | Many of these measures will be described as jam for the “Jams” (the acronym for that demographic now referred to as the “just about managing”, but previously termed the “squeezed middle”, “alarm clock Britain” or, less poetically, “hard-working families”). No doubt some of them will be a help, especially the bump in the minimum wage and the slightly more generous treatment of universal credit claimants. But that last tweak is for one year only. |
| Before leaving No 11 this summer, George Osborne planned £13bn in benefit cuts and a further £16bn taken out of the budgets of “unprotected” Whitehall departments. He also slashed spending for local councils. Given his ambition to balance the budget (by some as yet unspecified date), Mr Hammond is unlikely to drop any of those plans. So a working family that will earn a slightly higher minimum wage and a bit more next year on their universal credit will still have their tax credits frozen for the rest of this decade; their Sure Start centres will face the threat of closure and many of their children’s clubs and libraries could go to the wall. If Theresa May considers this helping, her version of hurting doesn’t bear thinking about. | Before leaving No 11 this summer, George Osborne planned £13bn in benefit cuts and a further £16bn taken out of the budgets of “unprotected” Whitehall departments. He also slashed spending for local councils. Given his ambition to balance the budget (by some as yet unspecified date), Mr Hammond is unlikely to drop any of those plans. So a working family that will earn a slightly higher minimum wage and a bit more next year on their universal credit will still have their tax credits frozen for the rest of this decade; their Sure Start centres will face the threat of closure and many of their children’s clubs and libraries could go to the wall. If Theresa May considers this helping, her version of hurting doesn’t bear thinking about. |
| Before Conservative backbenchers get too enthused about how their new prime minister is an ally of the working classes, they should take a look at the Credit Suisse Global Wealth report, published yesterday. An almanac of the fortunes of the international super-rich, it serves as an unassuming commentary on how unequal the global economy remains. That applies to the UK too, where the richest 1% own a quarter of the entire country’s wealth. That is not including any of the $7.4tn that, it is estimated, have been stashed in tax havens. If Mr Hammond were serious about evening up the UK’s economy, he would try to tackle that giant gap in wealth. Now that would make the autumn statement really newsworthy. | Before Conservative backbenchers get too enthused about how their new prime minister is an ally of the working classes, they should take a look at the Credit Suisse Global Wealth report, published yesterday. An almanac of the fortunes of the international super-rich, it serves as an unassuming commentary on how unequal the global economy remains. That applies to the UK too, where the richest 1% own a quarter of the entire country’s wealth. That is not including any of the $7.4tn that, it is estimated, have been stashed in tax havens. If Mr Hammond were serious about evening up the UK’s economy, he would try to tackle that giant gap in wealth. Now that would make the autumn statement really newsworthy. |