Tom Richmond: Bold Budget sees George Osborne’s stock rise as David Cameron’s successor

Harold Macmillan, John Major and Gordon Brown all made the short move from 11 to 10 Downing Street at a time of flux following the resignations of Anthony Eden, Margaret Thatcher and Tony Blair respectively. However their political and economic inheritances led to vastly contrasting fortunes.

Macmillan, an old school “One Nation” leader, presided over the “you’ve never had it so good” era of economic revival before being damaged by the Profumo scandal; Major won an election against the odds before his economic policy unravelled and he found himself presiding over an ungovernable Tory party, while Brown’s unyielding “boom and bust” approach contributed to the deepest recession since the Great Depression of the 1930s.

It is also the reason that Osborne now finds himself in the ascendancy after the seventh Budget of his Treasury reign – he won the argument in favour of responsible public spending so decisively that two of his principal adversaries, Ed Balls and Vince Cable, both lost their seats on May 7 and Labour is in disarray.

Already the de facto Deputy Prime Minister after his elevation to the role of First Secretary of State in the post-election reshuffle, he has quietly usurped those Tories long touted as successors to Mr Cameron, whose resignation prior to the next election is already pre-planned.

Theresa May, though the longest-serving Home Secretary since Rab Butler’s tenureship half a century ago, is perceived as being charmless; Boris Johnson is a diplomatic disaster waiting to happen and the self-made Sajid Javid, the newly-promoted Business Secretary, is still unproven.

Yet this Budget also completes the remarkable rehabilitation of a 44-year-old who commanded little confidence after his appointment as Shadow Chancellor 10 years ago – and who suffered the humiliation of being booed at the 2012 Paralympics. Now the keys to 10 Downing Street could be within his grasp if the Budget does transform Britain into a “higher wage, lower tax, lower welfare country”.

The reasons are also far more subtle than the makeover in the Chancellor’s personal appearance. He has listened to his critics and will take an additional year to introduce welfare reforms so work pays for all sections of society. His language has become less strident – the Emergency Budget promised before, and after, the election was quietly rebranded as a Summer Budget, and he is respectful of former Shipley MP Chris Leslie, the current Shadow Chancellor.

Unlike the brooding Gordon Brown who spent 13 years sulking over his decision not to challenge for the Labour leadership in 1994 after John Smith’s death, the current Chancellor has always played down his own leadership aspirations. This will now be more difficult, given the reaction to the first “true blue” Budget in 18 years.

And it would be wrong to under-estimate the significance of Robert Halfon’s appointment as his Parliamentary Private Secretary. One of the few Tory MPs to be a trade union member, Mr Halfon, who represents the bellwether seat of Harlow, has not allowed his own disability to stand in the way of a successful career and has become a powerful advocate for blue collar workers, thanks to successful campaigns opposing increases in fuel duty. This unlikely double act has helped Osborne to reshape his policies in favour of those workers on below-average wages with Conservative instincts, who were marginalised during the recession. It also saw him become one of the first politicians since Michael Heseltine’s heyday – Tory or Labour – to acknowledge the North’s potential.

However Mr Osborne is also an intently political Chancellor. Though he will attribute many of his more optimistic Budget pronouncements to his shrewd management of the public finances, the economic tide does certainly appear to be turning in his favour. If the Chancellor’s forecasts are accurate, Britain will finally record a budget surplus in 2019-20 – just in time for the next election. Significantly, 2020 is the the date when the new national living wage of £9 an hour – and 18p rate of corporation tax for business – is due to be introduced. These are three of many big traps laid for Labour.

Of course, there are major challenges ahead. The Greek crisis and Britain’s future relationship with the European Union are two “known unknowns” – to paraphrase Donald Rumsfeld, the former US Defence Secretary. The Chancellor still has to provide assurances his Northern Powerhouse blueprint is for real, following backtracking on rail improvements. And there is the fact that the country might just want a clean break from the David Cameron era.

However, if the Chancellor can cut the deficit while presiding over a firm but fair welfare revolution, he will almost certainly have earned the right to become Prime Minister if he so chooses.

Not only will it mark Britain’s recovery from austerity, but it will complete the transformation of a politician who was regarded as a petulant “pipsqueak” before growing on the job and becoming one of the most formidable Chancellors in post-war history.

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