The five things you need to know on Monday, March 6…
1 BUDGET MEANS BREXIT
In case you missed it, this week is Budget week. It’s the last one of its kind, before the tax-and-spending statement moves to the Autumn and is replaced thereafter by a mere “Spring Statement”.
This weekend, thanks to Philip Hammond’s various media appearances, we learned some of the big picture and smaller detail. He wants to squirrel away £60bn on a ‘Brexit warchest’ in case things go bumpy as we quit the EU. That this money could also be used for a 2020 election giveaway, if Brexit goes well, is obviously pure coincidence.
Both the Times and the FT put on their front pages that Hammond will fund extra payments for social care and business rate relief by putting up taxes for the self-employed (via National Insurance rises), drinkers and others. On the key issue of social care, a curiously precise figure of £1.3bn extra, plus a review, has been touted. The BMA has today urged Hammond to give the NHS £10bn a year more.
Shadow Chancellor John McDonnell suggested yesterday up to £12bn was needed for both, but how would that be paid for? Well, Shadow Business Secretary Rebecca Long-Bailey suggested yesterday there would be ‘widespread support’ for a tax rise, possibly a hypothecated one. Diane Abbott made plain her own unease at her younger colleague’s idea, telling Radio 4’s Westminster Hour last night that Tory ‘tax bombshell’ posters were very effective: ‘Those of us that remember the 1992 campaign, and a number of us in the leadership do remember it, are cautious about the question of putting up tax.’
2) ON THE NEVER NEVER
Jeremy Corbyn’s and John McDonnell’s decision to publish their tax returns was an attempt to shame the PM and Hammond into following suit. No.10 and No.11 show no signs of doing so (and the Shadow Cabinet seem slightly uneasy too), but has the Labour leader caused more trouble for himself in the process?
His own summary of his tax return appeared not to include the extra salary top-up he receives as Leader of the Opposition. The Telegraph was first to spot that there seemed to be a missing £40k. At 12.38am his communications team tweeted out that everyone should calm down as he’d listed £27k under ‘public office’ income, and it was ‘taxed at source’.
His office tell me this morning that he decided to list it as a ‘benefit’ rather than ‘salary’. I’ve asked whether that means he paid a different tax rate. The question remains why he didn’t include that sum as part of his ‘total income’. Is it because he didn’t spend the top-up on himself, but on staff for his expanded office team?
Meanwhile, former Shadow Business Secretary Clive Lewis said he could ‘never say never’ about running for the Labour leadership (the exact phrase Ed Balls used on Peston about his own prospect of coming back as an MP). But just as interesting was Lewis’s line that he was "75% hopeful" Corbyn could lead Labour to victory at the next general election. Diane Abbott said “I am 100% confident” that Corbyn will turn the polls around within 12 months.
Pollster Ian Warren’s survey of Labour members makes for fascinating reading on the leadership. He found that if Jezza stood down, John McDonnell and Yvette Cooper are joint favourites (26% each) to replace him. That McDonnell figure will delight his supporters. Umunna, Starmer, Lewis and Benn follow in the pecking order. Lisa Nandy gets just 8%.
McDonnell is before the PLP tonight. He, along with many of the Shadow Cabinet, was not present last Monday, but is sure to face lots of questions.
3) SMELLS LIKE MEAN SPIRIT
Work and Pensions Secretary Damian Green is liked across the Commons and his arrival at DWP was seen as an attempt by his old friend Theresa May (they’ve known each other since university) to combat the Cameron-Osborne perception that the Tories really were the ‘nasty party’ on welfare. Yet as the row over disability benefits showed, even Green cannot escape the reality that he has to keep a lid on benefit bills.
And just as he got into trouble for smuggling out the personal independence payment (PIP) announcement, Green is facing claims he sneaked out cuts to housing benefit for under-22s on Friday. Although he tried to introduce new exemptions, charities felt let down that the policy was still going ahead, especially after hints that May wanted to kill off another Cameron-Osborne legacy (though it was in the Tory manifesto). It only saves three million quid but the political cost of looking mean-spirited is quite high among the floating, centrist voters May wants to attract.
Now, Tory MP David Burrowes (a force to be reckoned with after his tax credits and schools relationships education victories) has told HuffPost the consequences of the housing cut could be ‘catastrophic’ for vulnerable young people. Burrowes wants ministers to wait for consultation. Labour is on the warpath, not least with Jeremy Corbyn and Debbie Abrahams lambasting the change. But will Labour commit to reversing the cut? Given the small cost, it might.
BECAUSE YOU’VE READ THIS FAR…
Watch Douglas Carswell say he won’t be rejoining the Tories. It’s now on the record.
4) OVER HERE
The Government is braced for an even bigger Lords defeat over its Brexit bill tomorrow, this time to write into the legislation ministers’ verbal pledge to give Parliament a vote on the final Brexit deal. But the ping-pong game will be swiftly suspended by the Budget, which takes up Commons and Lords time for several days, so we will have to wait to see if rebel Tory MPs rise to the challenge on this and on EU citizens’ rights.
Today, the Lords EU Home Affairs Sub-Committee has a report warning that ending the free movement of people from EU countries after Brexit may not result in lower overall migration. It points out that a ‘points-based’ system could produce ‘the worst of all worlds’ - and that immigration from outside the EU remains significantly higher than within it. Echoes of Blair’s warning there about Leave voters may feel let down if they don’t see all immigration drop.
The Home Affairs Committee has its own emergency report criticising the Government’s decisions on the Dubs amendment for rehousing child refugees. It says ministers’ decisions are not based on the evidence, which suggest closing the scheme would increase the risk of trafficking and exploitation.
5) MURDOCH MOMENT
Culture, Media and Sport Secretary Karen Bradley is expected to make a statement to the Commons today on the planned £18.5bn takeover of Sky by 21st Century Fox. Bradley said late last week she is “minded” to intervene and order an Ofcom investigation because of concerns over broadcasting standards as well as lack of plurality in the British media should the deal go ahead.
As it happens, Shadow CMS Secretary Tom Watson, no friend of Rupert Murdoch’s, has blogged that Sir Gerald Kaufman might have been responsible for the Australian tycoon’s switch from a youthful left-winger to joining ‘the dark side’ of corporate capitalism.
Murdoch was a socialist when he ran for secretary of the Oxford University Labour Club in 1952. He won but was then prevented from taking up his post after Kaufman, then chairman of the club, ruled that Murdoch had breached rules which prevented candidates from canvassing for votes. In a biography, Murdoch later said: “F****g Kaufman. ‘He was the same then, a greasy know-all.’ Watson says when he discussed the issue with his fellow MP, ‘He managed to portray contempt and pity for Murdoch in equal measure.’
SUNDAY SHOWS ROUND-UP
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