22/11/2017 Newsnight

He made us laugh...

I did take the precaution

of asking my right honourable friend

to bring a packet of cough

sweets, just in case.

He made us cry...

Regrettably, our productivity

performance continues to disappoint.

But did he do enough

for the country?

It's been a ragged old few

weeks for the government,

at a difficult time for the country.

Budget day is the big chance

for Chancellors to show they've

got a grip on things.

With some serious economic

downgrades, we'll ask

where the budget leaves us.

We have our home team

of specialist correspondents.

We'll hear from the

Government Treasury team,

as well as the opposition.

We'll digest the day

with our panel of commentators.

And we're all here in Bury

to bring you the first focus

group since the Chancellor

made that budget speech.

What do they think of

what he's offering today?

Hello.

The budget headline: Britain isn't

quite the strong economy

we'd hoped or thought.

And that's official.

The sixth biggest economy

in the world, the Chancellor

told us, not the fifth

as it is often described.

Our new budget forecasts predict

growth over the next five

years to be lacklustre.

Less than 2% all the way.

Pathetic is a term

that comes to mind.

Not that you would have thought

so from the early paragraphs

of Philip Hammond's speech,

with an upbeat description

of Britain's ability

to benefit from the white heat

of a new technology revolution.

For the first time in decades

Britain is genuinely

at the forefront of this

technological revolution.

Not just in our universities

and research institutes,

but this time in the commercial

development labs of our great

companies and on factory floors

and business parks across this land.

But we must invest to secure that

bright future for Britain.

And at this budget,

that is what we choose to do.

Well, park that thought,

because we soon had to get

into the nitty gritty.

And two big things stuck out for me.

First, that low growth.

It's all about productivity,

the amount we produce

for an hour of work.

In the past, productivity tended

to go up as we get better at things.

But look here at the graph -

when the financial crash came,

it fell right back.

And for years now, the OBR have been

forecasting that it'll bounce back.

These are the last few forecasts.

But actual productivity

simply stagnated.

So now they've scaled

back the forecast.

And from that, all other

bad news follows.

Borrowing, for example,

is not coming down nearly as fast

as the Chancellor wanted.

And this is not just

a temporary recession either.

Nor is this Brexit -

that could still muck everything up

as the forecast assumes it

goes fairly smoothly.

No, this is a downgrading

of our economic potential.

The productivity bounceback

is like an awkward date -

you wait for them to show up

at the restaurant,

after ten years you decide

they are probably not coming.

The OBR has assumed at each

of the last 16 fiscal events that

productivity growth would return

to its pre-crisis trend

of about 2% a year, but it has

remained stubbornly flat.

So today they revise down

the outlook for productivity growth,

business investment,

and GDP growth across

the forecast period.

That line was more important

than everything else

in the speech combined.

But a second striking feature

of this budget concerns public

spending and austerity.

After the last six elections,

we've had big tax rises to pay

for extra public spending.

Not this time.

An historic shift.

And yet, we still have spending cuts

baked in to our plans,

Sizeable spending cuts.

Here's the graph.

Per capita spending on government

services from 2015 to 2022.

So is this really do-able?

Today the Chancellor bunged some

billions into the public sector

to ease the pain in the next couple

of years but he's still

budgeting on pain later.

Well, that's two big themes.

There's a lot more to talk about,

notably three billion for Brexit

and lots on housing.

But here's Nick Watt

with his take on the day.

We have known him as spreadsheet

Phil, the cautious and rather dull

guardian of the nation's

public finances.

But after that hammering

at the general election, did the new

spendthrift Phil

step onto the stage?

The Chancellor unveiled

what the Treasury billed an extra 25

billion in spending and in easing

of taxes over the next five years.

This has been

a wretched year for the

government after Theresa May lost

her parliamentary majority in June.

The Tories were deeply unsettled

by Labour success in winning over

younger voters who believed

austerity had had itS day.

And then there are

the warring Brexit

factions who are overshadowing the

work of this government and putting

one minister in the firing line.

So today Philip Hammond

needed to reset

the dial for the Tories

by reasserting his own authority and

making clear he hears that cry

of frustration in June.

We are listening and we understand

the frustration of

families where real incomes

are under pressure,

so at this budget we

choose a balanced approach.

Yes, maintaining fiscal

responsibility as

we at last see our debt peaking.

Continuing to invest in the skills

and infrastructure that will support

the jobs of the future.

Building the homes that

will make good on our

promise to the next generation.

Jeremy Corbyn thought

the budget had failed

its first test, improving

the

lives of ordinary people.

Utter complacency

about the crisis facing

our public services and complacent

about the reality of daily life for

millions of people in this country.

Entirely out of touch with that

reality of life for millions.

While this had the

trappings of a normal

budget day, there

was a different feel.

The Chancellor's team were very keen

to talk up the extra

spending and in language that

would have been unthinkable until

relatively recently they talked

about fiscal loosening.

So is this Chancellor

really turning the taps?

Well, the answer

to that in the words

of Evelyn Waugh is up to a

point, Lord Copper.

This budget does mark a limited

net giveaway to help

the economy after the dramatic

downgrade in growth forecasts with

measures such as the abolition

of stamp duty for most first-time

buyers.

But then take aways are pencilled

in for the early part of

next decade.

The big news in the budget

was really the first few

minutes when he explained

that the growth forecasts had been

downgraded.

It has massive knock-on

implications, far less government

revenue, higher public borrowing

and a decline in people's living

standards beyond what they were led

to expect before the election.

That is £700 a head

at the end of the

parliament.

There was a mixed reception

amongst Tory MPs.

Some were a little

underwhelmed, but I

spoke to one leading Brexit

supporter who told me, I am

delighted with this budget

and I was hoping to get rid

of Philip Hammond

just a few weeks ago.

But the Chancellor faces a delicate

balancing act as he seeks to win

back those younger voters who

believe austerity has had its day.

He needs to spend in a way

that does not spook

the market but he needs

to

deliver change with

enough of a flourish

that the Tories get

the

credit - a mini me Labour budget

would probably rebound.

I think this budget

effectively effectively did

not go in for Corbyn light.

That is what I most

feared, that he would

listen to some of the dafter voices

lobbying, trying to press him to

give into as many lobbies as

possible to try to buy a few votes.

Even Corbyn light is not affordable.

First, get the economy on a

sustainable and reasonable path,

then decide how best to spend

the revenues that will produce.

If he was just handing

out money today, I

would have been very worried indeed.

One Labour critic of Jeremy Corbyn

thought the budget failed the

challenge set by her

party at the election.

There is nothing really hopeful

or inspiring about today's

budget.

There is nothing that says

we are going to get productivity

going up, this is a country about to

get up and start looking after

itself.

Actually what it is is growth

is down and productivity is

down and spending cuts have caused

growth to be down, so it is just

more of the same lack of hope

from a hopeless government.

Philip Hammond has for now

earned a reprieve with a

budget that was relatively well

received on the Tory benches, but

budgets that go down well on day one

can often run into trouble

further down the line.

When Chancellors get

punished for budget mishaps,

it tends not to be the really bad

news that gets them,

the downgrade of growth or whatever.

It is usually the specific measures

that entangle them in knots.

Today, the specific measures

that were the headline

grabbers related to housing.

Getting the young who feel shut out

of the housing market back in,

and back in love with the Tories.

Our business editor

Helen Thomas is here.

Also is Chris Cook who's

been looking at the NHS

and public spending.

Let us start Ities, with you, the

NHS, not cracking open the

champagne.

You can forgive a bit of

irritation in Whitehall, with NHS

leaders today. They have put in

about 2 billion next year, a further

3.6 billion over the rest of the

Parliament, in capital, the slight

problem is that the NHS made clear

that they thought they wanted 4

billion to make the sums up next

year and 10 billion of capital over

the rest of the Parliament, to

modernise the estate and make sure

the hospitals can keep up with the

ever rising demand for health care,

the thing is the NHS has this odd

structure, we have a chief executive

of the NHS, we have a chair of the

NHS England, and they are

independent, they are allowed do

what they like, they have started

campaigning for more money, so we

have this odd thing, they have been

given 2 billion, 3.6 over the rest

of the Parliament and Sir Malcolm

Grant says the extra money is

welcome, but he say, we can no

longer avoid the difficulty debate

about what is possible to deliver

for patients with the money

available. They will have a board

meeting to discuss what they do and

don't do on November 30th.

That is

big news.

Yes.

What about briefly,

the rest of public spending, because

there is a squeeze coming to a few

departments, even though they have

had one.

The critical thing is we

don't know where it will go, because

there is a sort of cliff edge in the

budget beyond which we know nothing

about public spending and huge

amount of pain is concentrated in

the mystery years.

Thank you. Helen.

Eye-catching measures on housing, a

stamp duty removal for first-time

buyers.

It was the headline grabber

so this zero stamp duty for Bayers

of up to £300,000 you can save for

up to 5 grand on a property of up to

a million pounds, this is sticky in

a few ways, Ed Miliband proposed a

similar policy in 2015 and the

Conservatives called it a gimmick

sand said it had been tried before

and failed. The Office for Budget

Responsibility said today, that when

it has been tried before, the

savings have basically been

incorporated into hiring house

prices and it hasn't helped

affordability. It is worth thinking

about, the average first time buy e

the purchase prize is 210,000, so

they will save about £1700. The

bigger savings is for Bayers of more

expensive property, if you are in a

part of the country with lower house

price, plenty of properties for

under 125,000, it doesn't change

things.

Look, one of the things they

have said, is the real measures have

to get the supply of housing up and

there was a lot in the budget. At

the end of the budget there is a

rabbit...

There was. A big headline

number was 44 billion in support for

the housing market. Now actually

only about 15 billion of that is new

measures announced today. The rest

was already out there. And most of

that when you lock at it was either

loans or loan guarantee, especially

to new builder, so private sector

builders, when you come down to cold

hard cash, spending announced today

was about 6 billion over five year,

so that sounds less impressive. What

I will say is that the housing

experts I have spoken to like some

of the areas that money is going

into. So they like the signs of a

more robust approach, and they like

this definite focus on resuscitating

the smaller end of the house

building market.

OK. Thank you.

Well, this government has had

a turbulent time in recent weeks.

Brexit is basically one concession

to the Europeans after another,

and there is a sense of a lack

of vision about that and more.

A government treading time to see

where things will go.

So does this budget show

a government with a direction?

I'm joined by Liz Truss,

who is Philip Hammond's deputy

Chief Secretary to the Treasury.

Also with us, Peter Dowd,

her Labour opposite number.

We'll come to you in a minute.

Let me start with Liz. Can we start

on that housing, the Office for

Budget Responsibility say on the

stamp duty measure, the main gainers

from the policy are the people who

already own property not the first

time buyers themselves. Because your

measure will push up the prices, so

the owners benefit not the Bayers.

I

think lots of people are struggling

to get on the housing ladder, there

are many people in that 20s and 30s

who previously would have been able

to buy a home, now finding it much

more difficult and of course, we

need to increase the supply of homes

and that is what the measures are

about and getting up to 300,000, but

we felt it was necessary to do

something now, to help those who

have struggled for a number of

years,

But you are not helping them if you

simply push the price of houses up?

People will not have to pay the tax

up to 300000 and they will have a

reduction up to 500,000. That is

cash you are not paying to the

taxman.

But you are paying the

higher price. Do you agree with the

statement by the budget of office

regulation that the main gainers are

the people who own property?

The

main gainers are people who will be

able to buy their own home.

You are

saying something different. They

said the main gainers were people

who own property.

That is who we are

aiming to help.

You disagree with

their analysis?

Their analysis

suggests that overall the impact on

house prices will be 3%. That is a

minor increase and what we are

looking at...

It is not a minor

increase for people who are buying!

The people we want to help other

people we want to exempt from tax.

Why did the Tory party say it was a

panicky, underfunded announcement

and failed last time when Labour

suggested this in the 2015 election?

This is funded announcement, our

budget package fully funded.

You

called it a gimmick and you said it

failed. Why would you pick up

something that Labour suggested two

years ago which you said was a

failure? The Treasury announcement

said when it was tried before it did

not have a significant impact in

improving affordability for

first-time buyers. The Tory party,

the Treasury, the Office for Budget

Responsibility all said it was

stupid.

We except the big issue is

supply and we need to expand supply,

but there is a need in the short

term to help people out because

people are struggling and we

recognise people are struggling with

getting on the ladder.

Are we not in

an era where you are actually saying

that by refusing to entertain the

notion that not helping people, but

you are just making gestures to show

that you care and you listen and it

does not matter whether it works, it

is more about what it says. We know

it does not work because of all

these people who say...

I am a

believer in low taxation. If we can

exempt people from taxes, lower

taxes for hard-pressed people, we

have done it on the lower allowance

and giving basic tax rate payers

£1000 of they would have paid and it

is the right thing for a

Conservative government to be doing.

Let's move on to spending. We heard

Chris saying the NHS is sitting down

and they need to work out what they

are going to do and not do. What

would be your advice over what the

NHS should stop doing because they

do not have the funds?

We understand

there are pressures in the NHS. We

have seen a big increase in the

number of people going to A&E and a

big increase in the number having

operations and there is pressure on

the NHS. That is why whilst keeping

to our fiscal rules we have found

that extra money for the NHS. We

have also said we were looked at

funding for a package for nurses and

other NHS workers as well because we

recognise how hard those people work

and we do want to be able to.

They

say they cannot do everything on the

budget they are given at the moment,

what would you like them to stop

doing in order to stick to the

budget?

A lot of the money we are

putting in its capital to be able to

modernised NHS facilities and that

should enable the NHS to improve its

productivity and be able to do more.

That is the whole purpose of that

capital funding.

You say they can do

everything.

We are giving them

capital money to help transform the

service so they can do more.

When it

comes to things like NHS targets on

waiting times and A&E which are

being failed all the time everywhere

at the moment, is there a chance

that we will start meeting those

targets?

Absolutely.

They will say

we cannot do it on this money, are

they wrong?

I am not saying they are

wrong, absolutely not, but I am

saying the money we are putting in

should help us reach those targets.

That is why we are putting the money

in and we have looked at how that

will help achieve those targets in

conjunction with the money we are

putting in to modernise facilities

and what we are looking at on pay as

well for nurses and other staff.

I

know you are not the Health

Secretary, but you either public

spending secretary, when do you

think they will be able to get back

into those targets?

This will help

make positive progress towards those

targets over the next few years.

You

used to be Justice Secretary and the

Justice budget has about 25% in real

time cuts over the last seven years

and it is getting another 15% or

thereabouts. Do you think seriously

you can cut the Justice budget by

that amount when you see what the

state of prisons are at the moment?

We have an extra 100 million into

prisons every year and we are

successfully recruiting more prison

officers, so we have made more real

progress and we are getting more

officers in our prisons and it is

fair to say the situation...

If you

were Justice Secretary, do you think

you could take 15% out of that

budget without shocking conditions

in prisons? That is the policy at

the moment. I am wondering if you

think you can deliver it.

I am

saying we put in an extra 100

million to deal with those staff

measures.

So they will not make the

15% cut?

There are ways in different

services like using modern

technology, cutting out some of the

paperwork and processes. If I can

give you an example... Let me give

you an example of the police force.

I went out with the Northern

Constabulary and they now use body

cameras, they did not need to go

back to the police station, they

have got a friend down and they can

do investigations and those things

more efficiently. That is great for

people in public services because

they are spending more time on the

front line and they can deliver that

service more efficiently. We are

carefully looking at every single

public service to make sure they

have the resources they need which

is why we are putting the extra

money into the NHS because we

recognise there are very real.

Very

quickly on growth and productivity,

do you think we should get used to

these figures are 1.5%? Is that now

the new normal? Would you work on

that assumption?

I do not think we

should accept that at all. I think

we have huge potential in this

country, I think we can do better

and I think we can match our

international competitors when it

comes to areas like maths and

computer science. It will take time.

Of course when we are changing

things like the school curriculum or

the number of students doing

computer science it takes a while

for those people to come through the

system. We have got tremendous

things going on in Britain. We have

got a record number of start-up

companies, $22 billion tech

companies, and I do that we have a

bright future. It will not be

instant magic but we should not

accept mediocrity, we have got to

get better.

Wait there until I talk

to Peter Dowd. It all comes back to

growth, doesn't it? In the Labour

manifesto you were spending £48

billion extra but none of it was

directed towards productivity. It

only got two mentions in the

manifesto.

That is not correct. Half

of that money was in relation to

education from early years through

to primary schools, secondary

schools, further education,

universities and lifelong learning.

That is an investment and that would

feed into productivity.

The spending

on education was mostly about giving

money to students, restoring the

education maintenance allowance,

abolishing fees. That will not raise

productivity unless you get more

students better taught.

That was

half that budget and a significant

portion was in relation to further

education which is where we should

be putting the money.

There was some

funding of 16-19 -year-old, but we

are talking less than 2 billion.

And

on top of that we had our

infrastructure spending of 250

billion, so there were significant

amounts in relation to raising

productivity and putting investment

in the system. That was there for

everyone to see. 48.6 billion.

Productivity relies on

infrastructure. Can I ask you about

new technology? Philip Hammond today

made a lot about driverless cars and

the industrial revolution and I was

wondering if there was a

philosophical difference. He wants

Britain to be good at driverless

cars and he wants them to take off

in this country. That could destroy

hundreds of thousands of jobs of

drivers. Do you welcome that or not?

Of course I welcome new technology.

The whole of the Industrial

Revolution is about new technology.

We are talking about the fourth

industrial revolution. You cannot

stop the advance of technology. What

that does not mean its people are

less well off and there are less

jobs.

What is the policy on

driverless cars? You agree with him

promoting them. What do you do to

all the drivers at the moment?

There

are suggestions that in the future

there are jobs which we do not know

will exist now. We do not know what

those jobs are. The idea that all

these people lose jobs and they will

not be replaced with other jobs, you

only have to look at Singapore and

the growth levels and the employment

levels, so they are not mutually

exclusive.

You have been very open

that you want higher taxes.

Criticism of the Labour position on

taxes is why you say you want higher

taxes you pretend to know one will

feel it. They will only be paid by

companies or a small number of very

wealthy people. The Institute for

Fiscal Studies has said you cannot

raise 50 billion through companies

because they were either pay their

workers less or charge their

customers more or pay out less to

pensioners who are shareholders and

rely on the income. Is it time to

admit that those costings will hit

ordinary people as well as just

companies?

I do not think it is time

to admit that because I do not

believe that. We set out absolutely

transparently hour 46.8 billion and

where we would raise that money

from. We believe it would affect

only 5% in terms of income tax

payers and the rest of the formula

will come from corporations. Let's

take an example. In relation to

corporation tax it was a 26% and the

government proposed to bring it down

to 17% and we would take it to 26%

and it was still be the lowest in

the G7.

Somebody has to Bear this,

either the shareholders, the workers

or the customers. That is the point.

There is no such thing as a company

independent of people who actually

run it.

That is the point, you raise

productivity, you put investment in

the economy, people get higher

wages, there is more profit and that

is where the growth comes from in

relation to the tax we get.

It is

all back to growth and both of you

would like that very much.

would like that very much.

Now, it is a grand tradition

on budget days to ask

what the public reaction is.

We've had a government in a mess

for the last few weeks and public

services struggling.

So has the Chancellor done anything

to get the show back on the road?

Emily has been in Bury today

with a focus group selected for us

by a market research company.

The panel was drawn from the local

area and designed to be

politically mixed -

some voted Conservative last time,

some for Labour and some

didn't vote at all.

These groups can never

offer a scientific study

of public sentiment,

but they did offer a rich guide

as to how things are playing.

Lynette, I'm going to come to you,

you picked up a few bits and bobs.

What were the things

that jumped out at you?

Interesting probably

was more money for the NHS,

I think that's something we really

need at the moment.

Also, the increase

in the minimum wage.

It's only a small increase,

but it's helping people

in this economic climate.

And also, I think, raising the tax

thresholds, I think the basic tax

threshold has gone up a little bit

and also the 40%, it's kind of gone

up ever so slightly.

So I think that's helped.

You work part-time so

that is helpful for you?

Yes, I think especially

with the basic tax, I think

that definitely helps,

along with the minimum wage.

It just helps push

things up a little bit.

Was anyone disappointed

by what they heard today?

Was there something you were holding

out for that you didn't hear?

Yes.

I overall was impressed

by the budget speech,

but I did want to hear something

about gambling, and trying to solve

this problem of addictive gambling,

I thought it was a bad opportunity

missed by the Chancellor today.

Can I ask the younger ones

whether they responded

to the first-time buyers

announcement at all?

Is that going to make a difference

do your life if you don't have

to pay stamp duty up to £300,000

on a house you're buying?

Yes, I think it will

help quite a lot.

Obviously as a first time buyer

300,000 is obviously quite a lot

of money but I'm looking to buy

a house into the next year and it

will help quite a lot.

I found it a lot easier

because it is hard now these days

to save up enough deposit to put

towards your first time house,

but the problem is, they're saying

they are going to build more houses

for us, but are they affordable

for people like us?

Are they just for the more people

that earn more money?

It's whether they get built as well.

Because they have promised to build

more houses before in previous

budgets and never built them.

I think it was 200,000 a a few years

ago and they never built them.

So who doesn't believe

the house building promise?

I don't believe it.

It is unrealistic for what they say.

I think they should try to free up

local authorities to build,

I think that would make a big

impression because they would build

social housing and I don't see any

route to social housing being built,

that has been mentioned

in the budget today.

Social housing that wouldn't be

privately purchased then?

Correct.

Right.

But they need to reduce the amount

of bureaucracy as well.

The old council house,

they were all built by the local

authorities, and that's just not

happened for many years now,

and there's an opportunity

today to do that.

Let me ask how many of you are still

living with parents, or parents how

many of you still have children

living with you, just

put your hand up if that...

I have two daughters

and a son, they're all at...

One's just finished her degree,

one is now a teacher,

and the other one is living at home,

he's at college.

Do you think this will help any

of your kids by buy their own homes?

I hope so, I really do hope so,

for them to be able to be able

to buy their own home would be

something that we

would be looking for.

Adam you said you are

trying to buy next year.

I think it is not necessarily

they have reduced it,

but I think it's the deposit that's

the big thing, that's

the difficult thing in getting

on the property ladder now.

Saskia, you're still living at home.

I'm still living at home,

and like I often think that compared

to some people, I think I'm

fortunate, because I never went

to university and stuff,

and I just think, you know

if some of my friend

who are at uni, they finish uni

and they have so much money

they owe, they are going to be stuck

at home for such a long time

because you know deposits to put

down on a house are just enormous.

And you would be looking

to buy your own now, would you?

Would anything in the budget

change your plans for the next year,

do you think or not yet?

I don't know all about it,

but it's optimistic you know,

to hear they are doing something

about it, they are aware

that this, it is a massive

struggle for some people.

Let me pick up on that now.

Who could tell me the hardest thing

in their life at the moment,

that the budget did

or didn't address.

My mum is an Alzheimer's sufferer,

she is currently in care,

she is living in a place,

a housing trust, but she's trying

to be rehomed at the moment

and the system is just collapsing,

it's falling apart.

Although there was mention

of money for the NHS,

there wasn't any specific mention

of money for social care

and particularly elderly social

care, and just being in that loop,

I know that that system

is ready to collapse.

More money for like specifically

allocated for mental health.

I think it is a really big issue

at moment and just mental

Health Services are really

like stretched at the moment,

waiting lists and I think they need

to really specify which areas

they are going to be spent in.

Who else would agree with that?

I agree with that but also

the conditions and disabilities

such as autism are not

catered for enough.

I work in autism, and I know

the measures aren't there

to assist particularly

the more challenging people.

So you would like to see more money

in the NHS for social

care for disability,

for mental health as well.

Let me ask you this question,

would you be prepared

to see your own taxes go up,

to fund better provision

of these services?

Just raise your hand

so we get a sense.

That is amazing, all

of you are saying you would be

prepared to pay more taxes?

As long as we can be confident

it is being spent properly

and it is not being misspent

in different areas.

It is like the alcohol duty

being frozen is a mistake,

that is a revenue stream we can get.

It is a luxury, you know,

people can afford it or they can't.

And I think to freeze it,

to go for the bottom end

and to freeze the alcohol duty

for me, smells of a vote winner

because a lot of the people...

It mentioned whiskey

so specifically that sort of thing,

but also I think, it maybe send out

the wrong message where

you are trying to get people

to drink responsibly.

We have a problem.

You know, we are not

really addressing it.

You say this because you mentioned

to me you're a drinker and a driver

a drinker and a driver -

not at the same time but you do both

yet you disagree the freeze on duty.

Yes, I mean obviously the fuel

is slightly different

because of the industry

and everything, and I understand

that, but I do definitely think that

tax and duty on alcohol should

have been increased.

So I find that extraordinary.

Did the Chancellor then miss

a trick, if you have

all said you don't mind

paying more taxation,

you have all said that, as long

as it's going in the right place,

so he could have raised money to pay

for the things you all want today?

He's a politician, he has

to be very careful.

He can't do what he may be wants

to do, raising taxes would perhaps

lose him an election

or something like that.

I think most people

expect alcohol to go up.

I think it's almost a given.

To not put it up, is almost

like a sort of "Oh",

but nobody really goes "Oh,

that's brilliant, I don't

pay two pence more",

but if you raise £10 billion

to spend on the NHS,

then we would have all

gone,"OK, fair enough".

People are much more socially aware

as well, aren't they,

so people have a better

understanding of how that money

could be better spent on, you know,

public servants, our public sector,

right across the board.

Let me just ask you a

really unfair question.

At the end of today,

who would feel inclined to vote

for Conservative at the next

election if it were called next week

on the basis of what you have

heard in the budget?

Well I would.

Just put your hand up.

OK, who would say they have been put

off by what they've heard today?

And we have four undecided.

Thank you all very much.

Thank you for coming in.

Let us finish today with some budget

reflections with a panel of big

brains and years of experience.

Rupert Harrison was chief of Staff

to George Osborne at the Treasury.

He now works for Blackrock.

Fraser Nelson is editor

of the Spectator, and Faiza Shaheen

is the Director at the Centre

for Labour and Social studies.

We'll get to them in a moment

but first, Nick Watt is here.

Nick, what are you hearing tonight?

How has this gone down

on the Tory benches?

I was talking to one member of

cabinet, someone who is a fan

I was talking to one member of

cabinet, someone who is a fan of

Philip Hammond he said at last we

have a political Philip Hammond,

there was the disaster of his budget

earlier this year when his pool

political antenna got into trouble

and this member of cabinet said he

could see the job he was needing to

do, which was answer that roar to

persuaded to people who voted Labour

and the Brexiteers reasonably happy.

Let us look at the headlines

tomorrow. Financial Times grim

outlook overshadows housing drive.

The Guardian he struggles to meet

the gloom. Two with a gloomy air

about them. The times goes Hammond

eases off austerity. And the Mail is

the most interesting. The Mail

dubbed him #e6789 eyore.

I think

that is significant. The is very

rescind, we are taking it away and

you say as you point out they are

saying we like what he does, but

crucially, they like his Brexit

optimism, so as long as he appears

to be saying the right things, they

will be happy.

Thank you. Panel,

first of all is this the end of

austerity? Some are writing this up

as the end of austerity.

It is

pretty much. Have accuse loot a

forecast, he has given up he will

balance the book, it is stretching

off into the future, we have had

lots of spending without any

indication about where the money

will come from. They have thought,

Jeremy Corbyn isn't going to tease

up for running up a massive debt so

we are in a political hole so let us

dig out with lots of borrowed money.

Have they given up on austerity?

I

think there has to be a recognition

it hasn't worked when you have a

missed so many of your target, and

when economic growth is downgraded

again, you have got to start

thinking this isn't the right

approach, saying that, the real end

of austerity would be to is that

right undoing the cuts.

We have more

to come.

Exactly. They haven't, they

are still doing the same narrative

about austerity is the right thing

rather than this opportunity to

invest.

Do you think this is the

key, that Jeremy Corbyn's relative

success against expectation in the

general election has spooked them

and they have said we need to throw

bait of money at stuff, is that your

take?

Yes, but they are just

gesture, they created it themselves.

Homelessness has doubled since they

have been leading Government, and

sow they throw money at it. They are

undoing the damage they have done. I

am not going to clap about it.

You

were there running it when austerity

was the name of the game. Do you

feel like this is a significant

change in direction?

It spent quite

a lot of money, so he is spending

tens the of billions more, normally

that would be seen as a pretty

expensive budget for the public

finance, the big picture it is not

the end of austerity, government

budgets are tight for some years to

come. It there are difficult

decisions like a benefit freeze that

is stretching years ahead. I think

they have paused their level of

ambition, I think that is partly for

the politics, and partly on the

economics that right now with Brexit

uncertainty isn't the time to be

doubling down.

Do you feel like it's

a vision of what it is doing or

where it wants to go? He said this

is not a budget about Brexit, it is

about more than Brexit. Did you get

the sense they have a kind of a

picture

I thought he did a better

job of telling the stories focussing

on house building and the

progressive nature of the reforms,

the top of the 1%, the richest 1%

paying 27% of income tax, these are

real achievements from conSepp

Blatter accepts sieve remortgages

and the forries have been bad about

boasting about it, but now they are.

So for once, he is beginning to

point out that this is not just

about cutting, this is about

building a fairer and stronger

country.

It is difficult to claim we

are fairer when we have so many

people going to food bank ex when

those on the rich list have seen

their wealth double.

Inequality has

been coming down. The States say we

are more equal.

Which measure are

you Ewing.

That is bad at the

extremes, you can ask the IFS that:

The overall measure of inequality

has come down since 2010 and the

people whose incomes have fallen the

most are those at the top.

I am more

interested, we have been saying the

narrative has been this is a

leaderless Government, it doesn't

know what it is doing, where it is

going. It is passing time. Has this

game change that?

For the economy,

and for what our country is going to

look like. Nothing else matters

but...

We don't know what anything,

this is a sort of Fantasy League.

A

statement for the Government to try

to say something and the biggest

thing it hasn't been a disaster,

which is more than you can say about

the party conference, the election,

about the last Budget. You need to

get through this and it not to

implode. So far the night is young

it hasn't.

What a low bar, what a

low bar we have set. Meanwhile,

meanwhile we have more nurses, 30%

more nurses leaving than join, we

have 88% of education of schools

facing real term cuts. I mean,

listen, when you look at the stat,

whether it is child poverty and

relative child poverty is going up.

When you look at homelessness, this

is not a sign of a healthy economy.

How far do you think is the, if not

the Jeremy Corbyn kind of nod to

him, at least a nod to Ed Miliband.

There is a lot of that about this

Government at the moment.

I think it

is a nod to Jeremy Corbyn more than

Ed Miliband. He lost an election and

Jeremy Corbyn also lost but he

gained a lot of seat, I think some

of the spending money on the Health

Service any Conservative Government

would do, what Chris Cook was saying

about the line between NHS England

and the Government is something to

watch. Your point about vision, I

thought that Philip Hammond managed

20 do today, which was just the

beginning, was try and give us a

picture of in the long-term there

are some things that might be more

important than Brexit, I think think

it is important but the new

technology, biotechnology,

driverless car, longer life span,

they will be more important than

Brexit. He did at least have a long

section of the speech trying to talk

about science and technology in an

interesting way. That was a small

achievement.

It is interesting from

the same sort of end of the

political spectrum, Rupert is

thinking Jeremy Corbyn has made a

lot of running here.

Yes, Corbyn

terrifies the Conservatives, sixth

months ago they were laughing at

him. It has been a big change.

Does

this work then? Ken Clark said it is

not Corbyn Lyth but do you think

what he has done shoots the Corbyn

fox, rail cards for 26-30-year-olds.

They are bribes and ghijs and will

be seen as such. We are at the

beginning of recovery. It is

beginning to show a government which

knows where it is going and made a

few reasonable steps today in

getting there.

This was a nothing

budget. There was nothing really in

it. It was gimmicks and gestures and

Hammond said this is about the

future and being fit for the future,

and then he had nothing, no

substance to really start backing

that up.

A lot of this is designed

to get young people up. The figures

are shocking.

What a stamp duty

holiday when young people are coming

out of university with £50,000 of

debt.

Do you think it will work?

We

likely have four years or more until

the next election, this is about

steadying the ship, about getting a

government that won't collapse

month-to-month, that can deliver

Brexit, and you know, by the time we

have the next election we will have

a new leader of the Conservative

Party and the world will look

different.

Thank you all very much.

Well, tomorrow we will probably

discover if there was anything we

hadn't talked about today, but that

is all we have time for for now. I

will be here tomorrow. Good night.