Can Rishi Sunak's Budget Satisfy the New Red Wall Conservatives?
Mike Buckley provides an analysis of why he believes the Government’s first budget – and the pressures of the Coronavirus outbreak – will be unable to satisfy its new voters.
The Government’s first budget was delivered less than 10 days ago and yet, in a country completely changed by the Coronavirus, it already feels like a distant remnant of a normal world.
COVID-19 will claim lives before their time. It could also lead to reform of our economy and transform our politics. Policies and viewpoints which are taken as read now may, in 12 or 18 months’ time, seem ludicrous, incredibly harsh or utterly irresponsible.
Will we be content with an NHS underfunded for 10 years when this is all over? Will we recognise a benefits system that makes people wait five long weeks before their first payment, or a statutory sick pay system that pays out a measly £94.25 a week? Will the gig economy and zero-hour contracts be justifiable, or a social care system run on the cheap and with incredibly high staff turnover? All of this and more may wither under the glare of media attention and public opinion; its deficiencies made plain.
It is also possible that this is a vain hope. Boris Johnson, Dominic Cummings and their friends arrived in power with an agenda and they will be loathe to give it up – virus or no virus. For now, they will see this as a challenge to move beyond, a distraction even, to be dealt with so that they can move on to their grand plans for reform. The Coronavirus may pass and leave us still staring at a ‘no deal’ Brexit, with all the damage that would do to an economy doubtless already transformed.
The New Red Wall Conservatives
The Chancellor Rishi Sunak’s budget was the best indicator we have of the kind of Government that will await us.
It was Johnson’s first real opportunity to give a statement of intent, free from Brexit votes, Tory rebels or the need to position himself for an election. It was meant to be the first staging post to ‘levelling up’ the economy and making good on his promises to new Conservative voters in the north of England. Johnson cared about it enough to force the removal of Sajid Javid as Chancellor, who clearly saw the budget as his domain, replacing him with the more compliant Sunak.
But was the budget enough to satisfy the hopes of the new Red Wall Conservative voters? Did it set up the economy to thrive, or at least survive, post-Brexit, deal or no deal? Did it attempt to resolve long-term problems in the British economy of uneven growth and investment, low productivity or deficiencies in training and education?
The budget headline was that it represented the end of austerity and the opening of the floodgates to pay for infrastructure, investment in the north and ‘levelling up’ the economy. Austerity had, in theory, been stopped before – most recently by Theresa May and Philip Hammond. So far, it has proved to be the policy that will not die and, in many ways, Sunak’s budget was no different. He may have stopped the cuts, but all that really means is that the Government has decided that it has cut enough and needs to go no further.
The budget offered no extra funding for struggling councils, which have seen huge cuts since 2010, and it will not re-open a single library, Sure Start centre or youth club that has closed. It will not allow councils to rebuild the social and civic fabric lost since 2010, which for many has been the most visible cost of austerity and has contributed to a sense of decline, lost pride and opportunity.
Nor was it a redistributive budget. There was no softening of welfare policy or move to raise wages or cut costs for poorer workers and families. It was also not a green budget, with Sunak instead committing to roads expansion but running shy of a fuel duty increase.
For public services and day-to-day spending, it was far more austere than anything Labour would have offered. In that sense, it largely followed former Conservative Chancellor George Osborne’s playbook: if austerity is cuts to councils and public services and the forced tightening of the belts of the already-poor, then austerity is here to stay.
But, where the Chancellor did something different in his willingness to spend on infrastructure and, in that sense, his budget was more Maynard Keynes than Milton Friedman. The £600 billion promised will fund the largest infrastructure investment since the 1950s, when the UK was rebuilding after the Second World War. If Sunak’s spending goes ahead, it will result in a raft of new roads, rail and regeneration projects that will be, for some, a visible representation of change.
Nowhere to Hide
Politically, the big question is whether this will help the Conservatives keep the voters they gained last December. Research conducted since the 2019 General Election suggests that roads and bridges are not what people are looking for. A mere 3% of new Conservative voters surveyed say that they will judge the Government on ‘whether transport infrastructure has improved’. Only 9% are primarily concerned about ‘whether my local area has improved’.
Instead – even before the Coronavirus brought the NHS right to the top of everyone’s agenda – surveyed voters said they planned to judge the Conservatives on ‘whether the NHS has improved’. A mammoth 62% listed the NHS as their top priority. They view ‘50,000 more nurses’ as the Tories’ most important election promise. They want to see more doctors and more beds; improvement locally as well as nationally.
Sunak’s budget did offer more money for the NHS, but comparatively small amounts compared to the huge sums thrown at road and rail. If lives are lost to the Coronavirus outbreak because of a lack of long-term investment and Government inactivity in the face of the crisis, voters are likely to judge accordingly.
The Chancellor did nothing to fix the fundamental problem of Conservative economic policy over the past decade. While it is true that talking about the state of the public realm did not secure a Labour victory in any of the last three general elections, the Conservatives changed the rules of engagement in December by promising spending and change. If they fail to deliver, they cannot hide behind the deficit as they did in 2015 or Brexit as they did in 2019. They will have to justify why things did not get better.
Mike Buckley is the director of Labour for a Public Vote. He tweets at @mdbuckley.