Philip Hammond’s Budget balls up will hurt the Tories a little bit

The Chancellor does not think much of the press or pay attention to what it writes, which is just as well considering the state of the newspapers this morning. For a Tory Chancellor to receive such a kicking from papers that usually, initially at least, give the party the benefit of the doubt is, from a government’s point of view, sub-optimal. But that doesn’t matter. Because the Chancellor doesn’t read the papers. And the media doesn’t matter…

Next door in Number 10, despite claims to the contrary, they take the newspapers and the media very seriously, while pretending to be above all that. There, endless headlines about May and Hammond going after the self-employed and entrepreneurs will not go down well. Many of these people impacted are May’s “just about managing” crew and the more affluent ones already pay a ton of tax. They may have been attracted by years of Tory rhetoric about enterprise too, and wake to find that the government is so amused by its lack of any opposition from Labour that it thinks it can do what it likes. Hubris springs to mind.

Now, here I must check myself for confirmation bias. I’ve over-reacted to Budgets on the downside in the past, which is probably a legacy of being a young journalist back when budgets were mainly about the hunt for Brown’s bombshell. Journalists look for the balls up‎ not only because it is interesting. A Chancellor has hundreds of billions of our money and armies of officials. Someone – the media, and ideally the opposition – needs to be alert to what he is up to with other people’s money.

Bruce Anderson – my esteemed Reaction colleague – judged this Budget “formidable”, which when it comes to Tory Chancellors is Bruce code for “ok”.

When it settles, the reality of a budget is usually somewhere in the middle. The Tories are in such an ostensibly strong position, thanks to the implosion of the Labour party and the popularity of Theresa May. Although, as I write in my column in The Times today, May needs a much bigger majority to power through Brexit, and to squash the nonsense in the Lords over Brexit. She should call an election this spring.

But designing a budget with an attack on the self-employed suggests that the government is not, borrowing Hammond’s phrase‎, “match fit.” in that sense, this budget will harm the Tories a little bit by making them look vindictive with people they consider among their target voters. It takes the gloss off.

I do not expect anyone to weep for self-employed and incorporated journalists and public relations consultants, although people should be concerned about the message this sends on punishing risk-takers and those battling away to make a living in an increasingly cold climate. By which I mean the shift to self-employment is a reflection of big changes in work, and the way in which millions of people go self-employed because the safety of well-paid jobs with benefits attached is not available to the same extent. This is a long-term problem for the Tories, who should be shaping policy to help a transition that – thanks to AI and other tech changes – is only going to accelerate.

To which the Chancellor would respond that this is why he has made this move. The government stands to lose ever more revenue as self-employment grows. So he wants to remove the tax advantages the self-employed get, which rests on the rules on National Insurance. Incidentally, I hear it said that there should be more of a level-playing field. When the imaginary day arrives that self-employed get sick pay, paid holidays and pensions, (which we should not get, of course) then the playing field can be considered level.

Personally, a little more tax is bearable if annoying. But as I pay it‎ I will ask the following question. Can I be assured that when the government is attacking the self-employed it is making a sound use of every penny it takes from us or borrows on our behalf? Any government that has taken such a relaxed view for years of the foreign aid budget and doles out winter fuel payments and other perks to very affluent pensioners, as well as to poor pensioners who need it, must expect the answer to be “no”.