There used to be a convention of ‘pre-budget purdah’ whereby, for several months before the budget, the lips of ministers and their officials would be sealed with respect to even the slightest speculation of what might be in the budget.
But in the last few weeks we have witnessed the Chancellor calling a press conference to ignite speculation that income tax would be increased, notwithstanding her earlier promise not to do so, then days later to issue a clear signal that, on further reflection, she won’t after all.
If this were just all political noise, it wouldn’t matter, but these speculations affect markets with real economic impact. Over the summer all the kite-flying from the Treasury has slowed up investment decisions and frozen the housing market. They have also increased the cost of servicing government debt, as are creditors have taken fright at some of the speculation.
On Monday I challenged Janes Murray, the Chief Secretary to the Treasury, with this question
“Given the blatant breach of pre-Budget purdah, will the Chancellor follow the proper example set by Hugh Dalton?”
He replied “I fear that my history is not good enough to know exactly what that question means. I am embarrassed to admit it. I am not entirely clear, but I suspect that I do not agree with the right hon. Member, whatever it was. I will leave it at that.”
Now, I would not expect any casual reader of this column to know about Hugh Dalton, but a Labour politician, indeed a Treasury minister, ought to know that Hugh Dalton was the Labour Chancellor who resigned because he inadvertently he let slip a sentence from his budget speech just minutes before he delivered it.
Standards were higher then. I can understand why they wouldn’t want to remember.
Sir Desmond Swayne TD
