PHILIP Hammond faces a delicate and difficult balancing act when he delivers his Budget this afternoon. He is in arguably the most difficult position any Chancellor has faced since the Second World War in setting out spending plans against a backdrop that is both unpredictable and uncertain.
As Mr Hammond underlined yesterday in his round of interviews, the eventual shape that Brexit takes defines everything in the year ahead, and if Britain leaves the EU without a deal, the Government will have to adopt a different economic strategy from the one he sets out today.
Although this is to a great extent a difficulty of the Government’s own making as a result of the schisms within Tory ranks that continues to obstruct achieving a settled position on what is best for Britain, this is far more than just a political dilemma.
The country is being left in limbo, and a sense of paralysis grips the Government, even as the deadline for leaving the EU grows ever closer. That this should be so apparent on Budget day, when the electorate has every right to expect a clear financial strategy for the future, only serves to emphasise the difficulties that beset Theresa May’s administration.
Nor does Labour inspire confidence by offering any coherent set of alternative proposals. Shadow chancellor John McDonnell devoted himself yesterday to attacking the Government, whilst essentially avoiding the question of what he and Jeremy Corbyn propose instead.
Heavily trailed elements of the Budget that have emerged so far, such as help for high streets and a programme of road improvements, are to be welcomed, even though it remains to be seen how substantial they turn out to be. But Brexit looms large over Mr Hammond this afternoon, and it makes everything else appear like tinkering at the edges.