Spring Statement: What Rishi Sunak should do – Bernard Ingham

Don’t punish low income families in Spring Statement as pressure grows on Rishi Sunak over cost of living crisis and rising heating bills – Justine Greening

They are:

1. Whether the West, galvanized by 
the Ukraine’s agony, recognises that 
we are beset by two evil empires in the East and takes the steps to secure its defence.

2. How individual Western economies ravaged by the Covid pandemic and now the mounting cost of Vladimir Putin’s unholy war manage their affairs so that our relatively comfortable way of life is secured.

Which brings me effortlessly to Chancellor Rishi Sunak’s financial statement in the Commons today.

This will be the first definitive indication of how the Government proposes to reconcile the conflicting demands for economy and spending.

We would first do well to approach the subject with a certain humility.

The chaotic economic conditions are not by any means entirely of the Government’s making.

Boris Johnson took the reins when, even after 10 years in power, the Tories had not eliminated Gordon Brown’s £153bn budget deficit.

That meant that we were vulnerable to shocks.

The first shock – Covid – roughly doubled our budget deficit and now we are supplying arms to the Ukraine to defend itself against the Russian horde.

The result is rising inflation and interest rates, soaring fuel prices and a cost of living crisis.

Meanwhile, the host of other 
problems facing the Government two years ago remain – the performance of the NHS and the social care system; an education system, along with other public institutions, that seems to 
deliver only the absurdities of wokery; and law and order overwhelmed by a crime wave.

In addition, our long love affair with greenery has left us without a secure basis for powering our economy.

Worse still, all the signs are that the Government remains besotted with unreliable wind and solar power and dithering about developing our own coal, oil and gas resources and reversing nuclear’s decline.

If Mr Sunak has not been heard to 
cry “It’s just one damn thing after another”, there is something wrong with him.

But it is his job today to set us on the right road and, indeed, to give his colleagues in the West a lead.

Some of them, notably in Germany recently accused by the Ukraine of being more concerned with commerce than lives and freedom, need stiffening.

He must leave the country in no doubt that we are up against it.

The situation cannot be turned round in a year or even in this Parliament.

It is profoundly dangerous to think we can ignore the bills still coming in.

We shall all have to tighten our belts.

This may be unpalatable to those born after Margaret Thatcher rescued the economy from trade union abuse.

But it is the simple truth and it must be faced.

The tax cuts that Mr Sunak says he wants will be some time coming.

This brings me to the fundamental problem in the Government so far – Boris Johnson’s cavalier approach to money and the inevitable rigour of a responsible Chancellor.

Let’s hope that Boris has undergone a Damascene conversion.

It is, of course, economic illiteracy to suggest that the Chancellor has leg room because of higher revenues.

That gift is bestowed only by a balanced and preferably surplus budget.

But there is a better case for ditching the proposed £14bn NHS levy on workers and employers and cutting fuel duty cut than for unfreezing tax thresholds.

The test – while rooting out the deadwood in the NHS – is whether there could be more economic growth without the levy.

Only a growing economy will improve matters.

Some will argue that the same test should be applied to tax thresholds but something has to give if you are also in the business of protecting the lower paid.

Let us be clear: the more we selfishly spend now or accrue through tax cuts, the more we shall have to borrow.

That in turn will increase our costs through rising interest rates and so increase the burden on our grandchildren and successive generations.

How much more do we want to mortgage their future?

The test of the Chancellor’s statement today is whether, assuming we are spared more shocks, the outlook is better this time next year and promises well for the future.

Support The Yorkshire Post and become a subscriber today. Your subscription will help us to continue to bring quality news to the people of Yorkshire. In return, you’ll see fewer ads on site, get free access to our app, receive exclusive members-only offers and access to all premium content and columns. Click here to subscribe.