Grants to ministers’ seats and plans to axe spending and lift taxes marred the chancellor’s post-Covid package
Richmond’s cobbled market square is quiet compared to the bustling Saturday mornings of pre-lockdown times, though there is a hubbub of well-heeled retirees bumping into people they know and stopping for a chat.
“The jewel in the heart of North Yorkshire, the gateway to the Yorkshire Dales,” is how the town proudly brands itself. Tourism is important here. But even when visitor numbers are badly down, as they are now, there is an air of rural affluence about the place that suggests Richmond will survive hard times far better than most.
Estate agent windows show off properties commanding well above average British prices, with four-bedroom houses comfortably fetching half a million pounds. It is a top destination for retirees, with its upmarket shops and pubs and beautiful surroundings.
“I wouldn’t have said Richmond is in need of substantial investment. It’s not deprived,” says Angela Corrie, a retired childminder who moved to the town from Leicestershire three years ago and is out shopping.
The issue of extra government money for Richmond and surrounding areas has been a hot topic – and not just locally – since it was named on budget day last Wednesday as one of the 100 “priority places” permitted to bid for a new Community Renewal Fund, a pot of £4.8bn to support job creation in local economies.
The announcement has been welcomed in the town because job opportunities for local young people can be hard to come by. But it has also caused some bemusement.
David Saynor, a semi-retired lecturer who was thinking about buying a home in Richmond or the surrounding towns, said: “Look around. They don’t need it. There are people elsewhere who can’t even afford a meal.”
Market trader Glenn Williams said on first impressions the decision did, indeed, seem odd. “I’m not really sure what they’d spend it on,” he says, before adding: “Why here, of all places? Well, I can tell you why. You know who the MP is don’t you?”
The chancellor of the exchequer, Rishi Sunak, has been the MP for Richmond since 2015. In December 2019 he cruised to victory, retaining one of the Tories’ safest seats having piled up 64% of the vote, with Labour second on just 16%.
Last Wednesday’s budget was, however, the biggest day of Sunak’s political career to date. He had to balance the needs of a country still in the grip of the pandemic with those of an economy ever-more mired in mountains of Covid-related debt, if he was to advance his obvious ambition to, one day, become prime minister. “Support, honesty and building the UK’s future economy” were the three themes that the Treasury briefed out to journalists in advance as being central to Sunak’s budget speech.
Despite announcing plans to raise taxes for individuals and businesses that would see the overall tax burden rise to its highest since the 1960s, the chancellor’s decisions to extend the furlough scheme, prolong the £20 a week uplift for those on universal credit and lengthen the stamp duty holiday on home sales until the end of June, while announcing big new incentives for businesses to invest, all helped win him plenty of initial plaudits.
“Tax-raiding budget gives poll boost to Johnson” was Friday’s approving front page headline in the Times which reported a survey by YouGov showing that the Tories had opened up a 13-point lead over Labour and that the Sunak budget was proving popular, with 55% of people describing it as “fair”.
But that was perhaps the high point. As so often with budgets and budget weeks, they start well, then gradually unravel as more unwelcome details and inconsistencies are unearthed, and end as “botched budgets” with the chancellors who hatched them under pressure to perform humiliating U-turns to undo the political damage done.
It is not only that the government is facing calls this weekend to publish criteria for the choice of locations, such as Richmondshire, which are eligible to dip into the huge “levelling up” pot for supposedly deprived parts of the country. As the Labour leader Keir Starmer noted, there is a related issue of why 40 out of 45 towns receiving money from a separate “towns fund” also unveiled last week are represented by Tory MPs. “I think lots of people would scratch their heads and say ‘what is going on here?’” said Starmer. The Communities Department awarded its secretary of state Robert Jenrick’s Newark constituency £25m to fund projects including the renewal of Newark Cathedral.
The claim that the budget had fairness and honesty at it heart was more widely challenged. Paul Johnson of the Institute for Fiscal Studies (IFS) said the chancellor was not “levelling” with people – making out he was the bringer of gifts while administering over £4bn of spending cuts that would cause widespread pain: “Take account of the cuts to planned spending announced in the autumn and Santa Sunak, purveyor of billions today, looks more like Scrooge Sunak, cutting spending and raising taxes to the tune of nearly £50bn relative to his pre-pandemic plans of March 2020.”
Johnson also could not understand how the chancellor could extend the universal credit uplift, only then to withdraw it abruptly in the autumn. “It is, by the way, remarkable that while the chancellor felt the need for a gradual phase out of furlough, business rates support, stamp duty reductions and VAT reductions he is still set on a cliff-edge reduction in UC such that incomes of some of the poorest families will fall by over £80 between one month and the next. Whatever the case for cutting generosity into the longer term, if you’re going to do so the case for doing it gradually rather than all at once looks unanswerable,” he said.
Privately Tory MPs, most of whom seemed ecstatic on budget day, were beginning to ask whether the government had misplaced its political antennae. Many were seriously upset by the fact that the budget omitted any mention of the need to reform and boost funding for social care, the issue successive Tory governments have booted into the political long grass, but promised finally to address once the pandemic ruthlessly exposed the problems.
Two days after the budget, Andrew Dilnot, who led a review of social care funding in 2011, told the Observer that a failure to fix the system as part of a public spending review later this year could leave it unfixed beyond 2024, when the next election is due. “If we don’t make decisions this year, it’s very hard to see how they can be implemented before the next election,” Dilnot said. “I really do think this autumn is the time and we just need to ask ourselves, ‘how high up our list of national priorities is this?’”
As was the case when Covid-19 first emerged as a threat to the world, and the UK reacted too slowly, when Boris Johnson and the Tory party were celebrating a stunning election win and “getting Brexit done”, now many MPs see signs of them taking their eyes off the ball once again, believing the vaccines are their political saviours. Elements of the Tory press appear to sense this too.
The way the Daily Mail has pursued Johnson all week over the expensive, mysterious refurbishment of the Downing Street flat he shares with his fiancée, Carrie Symonds, is a case in point. The paper senses sleaze and entitlement and does not like what it sees. “No 10 Decor Scandal. Tory HQ Cover-up exposed,” was its headline as it also emerged that more than £2m had been splashed on a fancy Downing Street press centre for televised briefings that have never materialised.
But the sub-theme of sleaze is being drowned out this weekend by perhaps the biggest political miscalculation of all during budget week. Johnson praised NHS staff to the hilt almost a year ago when he came close to losing his life to Covid-19. The nation was stirred to clap every NHS and non-NHS carer each Thursday night of the first lockdown.
But with those memories fading a little, Sunak’s budget was followed by news that health secretary Matt Hancock was recommending to the Pay Review Body a pay rise of just 1% for nurses for their efforts throughout the pandemic.
Tory MP and doctor Dan Poulter who has been working on the Covid-19 front line as a psychiatrist was one of many Conservatives to be left dismayed by the offer which he said was morally questionable. “A lot of health professionals in the early part of the pandemic were working without the right equipment to protect themselves, and many people have gone above and beyond the hours they are already paid for during the pandemic and have really pulled together in very difficult circumstances. For me, this is, from a moral perspective, the wrong time to be applying pay restraint.”
The unions are threatening strike action. But this Thursday night there are plans for a slow hand clap for a government that deserted the nurses. The only option, many MPs believe, is for a full blown U-turn after a budget week that was supposed to be all about support for those who deserve, and need it, most.