Alistair Darling, in a speech so thoroughly Brownite in style and delivery that I found myself looking for the Prime Minister’s lips moving, could hardly be blamed for conniving in that bizarre British institution, The Budget. While there is nothing wrong with an annual explanation to Parliament of the state of the nation’s finances, the idea that the our taxes should be reshuffled every year for political effect is pretty depressing – even if we in the media encourage it.
The modern budget has long resembled children’s party entertainment, with the Chancellor cast in the role of a clown scattering gum drops or a magician pulling rabbits out of hats. In this case, Mr Darling made a lacklustre conjuror and the sweeties were thin on the ground, but the country is none the worse for that.
A quick sampling of some of the proposals reveals how weak the tricks have become: fuel duty is to be raised more than expected, yet a previously-announced raise in the tax is to be postponed by six months; child benefit will be raised sooner than expected; a scarcely-credible carbon dioxide target for 2050, a date on which Mr Darling is unlikely to be in any state to be held accountable, may or may not be made less credible still; the government is to spend 33p per citizen per year to “build skills” in some way or another; a tax on moving house is to be fudged for people who don’t own the house in its entirety.
A kind observer might describe this as fluff. A fairer characterisation would be that the Chancellor is pressing barnacles onto the hull of the British economy: hard to remove, a modest obstacle to progress, and just plain ugly.
One or two of the proposals looked sensible. Some money towards trialling road pricing? Not before time.
An increase in the winter fuel payment for pensioners would make much more sense if combined with an end to the subsidy on domestic fuel the government insists on giving the rest of us, which was always an inept way to fight fuel poverty by discouraging the nation from putting in double glazing.
But the smoke and mirrors far outweighed the serious policy: we had a paean to the armed forces, bluster against energy companies and a threat to twist the arms of supermarkets, and – bizarrely – an announcement about biometric security measures at airports. Has fiscal policy really come to this?
The truth is that it was never sensible to expect important improvements to the nation’s fiscal system to be announced every March. Mr Darling did very little today; we should be thankful for small mercies.

March 12, 2008 1:54pm in Grown up economics | Comment