The Chancellor, in one move, has doubled the national debt to one trillion pounds, and borrowed more than at any time in our history. He is reverting to old fashioned Labour spend and tax policies.
He has deployed a cynical, pre-election year, mostly short-term tax give away of £20bn. But then proposes paying for this after an election with a £40 billion permanent tax hike, equivalent to almost £1,500 for every family, with hints of more to come in the future.
This was a desperate gamble by the Government to try and spend its way out of the recession and as a middle-class tax time-bomb. His Pre-Budget Report assumes the country comes out of recession after the first six months of next year. I hope it does, but the Treasury's forecasting track record has been overly optimistic for each of the past 8 years. If they have got it wrong again, the borrowing black hole will be even worse, and pain for the people prolonged.
What the Chancellor should have done was introduce practical measures to keep Britain working. Banks are not lending to businesses, consumers are not spending. Without vital cashflow many risk going bust. Some measures, such as phasing tax payments (originally proposed by the Conservatives) are welcome, but much more should and could have been done to underwrite lending to British businesses, large and small, to keep Britain working and to get a grip on Government spending.
Gordon Brown is mortgaging the country's future to try and safeguard his own. Prudence is dead, Labour's profligacy will once again have to be paid for. I only hope not by too many lost jobs.
