Andrew Neil has torn apart Jeremy Hunt over his “Budget for growth”. The journalist, widely regarded as Britain’s toughest political interrogator, warned the measures unveiled by the Chancellor yesterday will not “do very much” for growth.
Mr Neil said the economy will still “stagnate this year at best” and only be slightly better than expected because the Office for Budget Responsibility (OBR) – the official forecaster – was “far too gloomy” last November.
The ex-BBC presenter told LBC: “It’s been billed as a Budget for growth but it doesn’t do very much for growth.
“The economy is still going to stagnate this year at best, a little bit better than what the official forecasters said in November.
“But that’s not because of the Budget, it’s just the official forecaster was far too gloomy about our prospects this year back in November.
“The OBR has added up all the measures in the Budget and has concluded that at its peak they will add precisely 0.3 percent to growth.
“And then that tails away to zero. So if that’s a Budget for growth I have a bridge to sell you.”
Mr Neil said the Government should have pursued a more expansionary fiscal policy – which would involve higher spending or tax cuts – to boost the economy.
He said: “I think the Government should have run a more expansionary fiscal policy.
“I think it should have been prepared to keep the deficit a bit higher than it is, pump some growth into the economy.
“Perhaps mitigated some of the effects of the tax rises on top of some of the public spending it’s done.
“Don’t forget over three million people who at the moment don’t pay tax, their low earners, are going to be dragged into paying the 20 percent rate.
“Over two million who currently pay the basic rate are going to be dragged in to the 40 percent bracket. A tax bracket which when invented was only meant to be for the very richest.
“I think ironically if they’d just been prepared to do a bit more pump priming to get some more growth into the economy this year, they’d have found next year and later the Budget deficit would have come down, the debt as a share of GDP would have come down and the growth would have been stronger. But instead they went down the fiscal conservative route.”
Mr Neil also claimed there was “almost nothing” in the Budget to help families hard-pressed by the cost of living crisis.
He said: “The household incomes at the moment are being squeezed as never before in living memory.
“And there was almost nothing in yesterday’s Budget that addresses that in any way.
“Indeed tax policy makes it even worse. In the end the only proper way to judge a Budget is what it does for the condition of the people.”
On whether the Budget could help the Tories – who are flagging behind Labour in the polls – ahead of the next general election, Mr Neil said any economic recovery is likely to be “too late”.
But he pointed to recent successes with Rishi Sunak’s Brexit deal on Northern Ireland and the Aukus pact with the US and Australia to create a new fleet of nuclear-powered submarines to counter China’s muscle flexing in the Indo-Pacific region.
Mr Neil said: “It’s not the greatest of my concerns as a result of the Budget, I’m much more worried about the economy.
“But in terms of the political fallout, I think other things are going the Government’s way including the Northern Ireland Protocol and this big deal with America and Australia, which suggests they’re getting a grip again.
“I think the danger for the Tories is that what recovery there will be will come too late.”
As he delivered his Budget in the Commons yesterday, Mr Hunt hit out at “declinists”.
Referring back to the autumn when he stepped in following Liz Truss’s disastrous mini-budget which sent the economy into freefall, the Chancellor said: “In November we delivered stability. Today it’s growth.
“We tackle the two biggest barriers that stop businesses growing – investment incentives and labour supply. The best investment incentives in Europe. The biggest ever employment package. For disabled people, more help. For older people, barriers removed.
“For families feeling the pinch: fuel duty frozen, beer duty cut, energy bills capped. And for parents, 30 hours of free childcare for all under fives. Today we build for the future with inflation down, debt falling, and growth up.
“The declinists are wrong, and the optimists are right. We stick to the plan because the plan is working.”