No Answer Andy’s Circus, Where Everything Is Going Up Except Confidence.
Welcome back, dear readers, to another riotous week beneath Westminster’s Big Top of Blunders, where No Answer Andy is still smiling for the crowd, the Treasury contortionists are searching for new ways to bend the tax system, the welfare elephant is getting larger by the minute, and the Defence Department has apparently decided that soldiers can prepare for war by imagining the ammunition.
This week’s circus has a remarkably simple theme. Everything is going up. Grocery bills are up. Inflation is up. The welfare bill is heading up. Council tax could go spectacularly up in Wandsworth. The number of homes potentially caught by the mansion levy could go up. And, as Sir Jim Ratcliffe warned in an interview this week, some of the people Britain relies upon to create wealth are increasingly tempted to get up and leave. Burnham, meanwhile, is warning of a “challenging” Budget after inflation rose to 3.1 per cent. In Westminster language, “challenging” has a nasty habit of meaning everybody should check their pockets.
The welfare act is becoming particularly difficult to ignore. Official forecasts cited this week put total welfare spending on course to rise from £314.8 billion in 2024/25 to £406.9 billion by 2030/31, with health and disability spending approaching £110 billion. Labour tried to reform PIP, its own MPs rebelled, ministers retreated, and now the Government is confronting essentially the same problem again. It is a magnificent circus routine. Spot the elephant, announce that the elephant must become smaller, get shouted at by the clowns, abandon the plan, then return a year later looking astonished to discover that the elephant has continued eating.
Over in Wandsworth, the fiscal trapeze act is considerably less amusing for residents. The council says changes to government funding could ultimately leave it with £84 million less support each year and force its Band D council tax up by £958, potentially a 94 per cent increase in the borough’s portion of the bill. The final tax has not yet been set and ministers argue that Wandsworth has historically enjoyed unusually low council tax, but Kemi Badenoch has instructed lawyers to examine a challenge to the settlement. Somewhere in the Labour Big Top, “fairness” is being twisted into another balloon animal while residents wonder why it looks suspiciously like an invoice.
And if you happen to own a valuable house, don’t get too comfortable. Reports that the Government is considering lowering the threshold of its mansion levy have raised the prospect of around 270,000 properties being caught. Thus continues one of Westminster’s favourite magic tricks, introducing a tax for a relatively small group before everybody starts wondering how long it will remain relatively small.
Defence provided perhaps the most extraordinary performance of the week. A senior French NATO commander warned that cutting military exercises to save money was a “recipe for disaster”, after Army training involving live firing and armoured vehicles was curtailed amid efforts to save around £30 million. Lieutenant General Benoît Desmeulles put the matter rather succinctly, “No training equals no ‘fight-tonight’ capacity.” Britain is simultaneously being told by NATO to increase defence spending while parts of its Army are economising on the activity armies traditionally find quite useful before a war, namely practising.
The justice contortionists were limbering up too. Labour is reportedly retreating from proposals for a new system of judge-only courts after opposition from lawyers and some of its own MPs, although restrictions on jury trials remain under consideration. It is another familiar Westminster routine, float a dramatic reform, defend it, discover everybody hates it, reverse halfway and call the resulting position a carefully considered compromise. Even the trapeze artist normally knows which platform he intends to land on before jumping.
Then there is the cost of living. Grocery prices are climbing again while Burnham’s Government prepares a difficult Budget and inflation sits above target. Hospitality bosses have had enough of warm words too, with more than 800 leaders from pubs, restaurants and hotels demanding that Burnham deliver the VAT reduction he previously advocated, cutting the rate for hospitality from 20 per cent to 10 per cent. Apparently the hospitality industry would now prefer fewer sympathetic visits to pubs and rather more action on the bill.
Farmers have their own grievance, with opposition continuing over agricultural taxation, while London’s ultra-prime property market is facing concerns about wealthy buyers looking elsewhere. None of these stories alone proves that Britain is experiencing some great economic exodus, but together they raise an uncomfortable question for a government desperate for growth, how many times can you increase the cost, tax or regulatory burden on people and businesses before some of them decide they would rather perform in another circus?
Water supplies another spectacularly expensive elephant. Labour’s proposed shake-up is taking place against longstanding warnings that fixing Britain’s water infrastructure could require investment on an enormous scale. Whatever model ministers ultimately choose, there is no magic tap marked FREE MONEY. Somebody pays, consumers, taxpayers, investors, or some combination of all three. Westminster may rename the bucket, but the water inside still costs money.
And this is what makes Week Nine so magnificently bleak. Labour wants more welfare spending but worries about the welfare bill. It wants wealthy people and businesses to remain in Britain while contemplating new ways of taxing wealth. It wants stronger Armed Forces while the Army economises on training. It wants cheaper living costs while inflation rises. It wants thriving pubs while hospitality bosses demand tax relief. It wants growth while increasingly being warned by people responsible for investment that Britain needs to become more attractive to capital.
You would need the flexibility of three contortionists and a snake to make all of that fit comfortably into one political programme.
No Answer Andy nevertheless remains beneath the spotlight, assuring Britain that difficult choices lie ahead. Around him, the Treasury jugglers are reaching for another tax ball, the welfare elephant is trampling the furniture, the Army is checking whether imaginary bullets count as training, and another magnificent balloon animal marked GROWTH is slowly floating towards the roof of the tent.
The Labour circus keeps promising that the next act will make everything better.
The audience might simply like to know how much the ticket is going to cost.
READ ALL ABOUT IT: Links to this week’s top Labour circus acts below:
