Budget 2021 Analysis: Green shoots for levelling up, if not a silver bullet

Brand Rishi’s headline grabbing breadcrumbs over the last few days pumped up the pressure on the Chancellor to pull a spectacular rabbit out of his hat at the Budget today - even the Speaker Linsday Hoyle commented he already knew most of what Rishi Sunak was due to announce.

Rishi Sunak leaves for the Budget. Photo: PA

And the standalone policies, in many ways, did live up to the hype.

The super deduction, billed as something “never tried before in our country”, could be prosperous for Yorkshire and the Humber, especially if when combined with other initiatives the investment that comes from it is targeted to the North.

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And welcome moves of civil servants to Darlington, and Leeds as the location of the UK Infrastructure Bank are positive

For those ticking off which levelling up promises have been met, Humber and Teesside have also been successful in their freeport bids, and will get new investment for port improvements linked to windfarm projects.

But are these one-off successes enough to fulfill what the Chancellor himself described as doing “what ever it takes”?

Labour noted the lack of a pay rise NHS staff and no clear indication for a plan for social care, and Keir Starmer said it “papered over the cracks, rather than rebuilding the foundations”.

And it did feel as if the Chancellor, now facing the difficult pivot from the man who hands out the pocket money to the one demanding it back, was somewhat constrained in his ambition - and maybe he could have done much more if the economy was not in such a disastrous state.

If the country has faced one of the “most comprehensive and sustained economic shocks” ever, indeed borrowing is at its highest since the Second World War, what was needed was a comprehensive and joined up plan for recovery, a programme that made people feel like the future could be prosperous again, or what Jim O'Neill has described as a "silver bullet".

Mr Sunak should be praised for his beating of the grim forecasts provided, but in many ways this was a Budget you might expect from any Conservative Chancellor - the concern about the national debt palpable, despite there being little economic evidence that that should be an immediate worry right now.

However the move away from austerity to balance that debt was clear.

Talk of fairness, a hike in corporation tax, and an effective tax rise in the freezing of the personal allowance are a step change. The corporation tax rise alone is a complete policy reversal.

For Labour, this approach creates a lot of issues. While, as mentioned, the immediate imperative to reduce the debt may not be economically sound according to some, it does play well with voters who feel the need to balance the household budget. Now, the Tories have also appropriated Labour’s preferred method for boosting the coffers.

The challenge for Rishi Sunak will be following through and not slipping back to cutting services to achieve that much-wanted balanced budget, for Labour it will be coming up with a new tack for meeting the spending commitments its manifesto already promises.