‘Slash-and-crash' budget puts politics ahead of the nation, says IPPR

Today's tax cuts imply unfeasible and undesirable public spending cuts in the future 

IPPR has reacted to measures announced in today’s autumn statement by Jeremy Hunt, the chancellor of the exchequer. 

Harry Quilter-Pinner, IPPR director of policy and politics, said: 

“Today’s slash-and-crash budget put politics before the needs of the nation. No one believes that future cuts to day-to-day spending are possible, or that squeezing public investment further is sensible, yet the government chose to slash taxes today at the expense of crashing public services tomorrow. With the NHS, pensions, childcare and defense spending likely to be protected, future spending plans imply big cuts across other key public services. This isn’t fiscally responsible, economically desirable nor politically popular. 

“The Chancellor has once again missed an opportunity to show that the government has a real plan to tackle the issues facing our nation. Growth remains low, people are struggling to pay the bills and our public services are crumbling. Yet today’s budget had few real answers to these pressing problems. We desperately need a real plan for shared economic growth, investment in our economy and net zero, and properly funded public services, supported by progressive tax reform.” 

On the economy, Dr George Dibb, associate director for economic policy at IPPR, said: 

“This is a budget that shows an obsession with cutting taxes today at the expense of vital public services tomorrow. Cutting National Insurance Contributions is not the right priority right now, with almost with almost 50p of every £1 this costs going to the richest fifth of households, and just 3 per cent going to the poorest fifth. 

“The only upside of this budget are the reforms to the tax system that don't hit working families but raise more revenue from the wealthiest, as IPPR has long argued for. Reforming the non-dom tax system, higher tax on holiday rentals, and a further levy on first-class air travel are first steps that show how the government could find more resources for better public services from those most able to support this. Disappointingly, that’s set against backward steps such as cuts to capital gains tax and a freeze to fuel duty. 

“The real burdens that we face as a society are poor health, unequal wealth, squandered economic opportunities, and confronting the climate crisis - all adding up to total economic stagnation. Fairer taxes would provide the remedy for these.”