The Budget uncovered

Mar 13 2008 By Andrew Mernin

Mr Dull's attempt to be reassuring on economy

BORING he may have been, but Alistair Darling will be hoping voters will have been reassured about Labour’s economic competence.

For that was at the centre of the Chancellor’s first Budget – to show that the good ship Labour under the captaincy of Gordon Brown has not come a cropper on the rocks of economic failure.

Mr Brown may have been able to steam ahead in the polls when he became Prime Minister last summer, but he has since been hit by wave after wave of problems from donation scandals to missing data and the Northern Rock crisis.

Fears of a housing and wider downturn have also heaped pressure on the reputation that Labour has strived to build in terms of economic competence.

But Mr Darling sought to reclaim that reputation, insisting that Labour had the record and experience to steer the country through predicted tough economic times rather than the Conservatives under David Cameron.

In a compare-and-contrast exercise in his Budget speech, the Chancellor insisted the Government had transformed the country for the
better and heaped scorn on the Conservatives’ time in office.

Mr Darling claimed: “Ten years ago there were 600 schools in which less than a quarter of pupils gained at least five good GCSEs. Today there are fewer than 50.

“Compared to 1997, 10% fewer people die from cancer each year thanks to faster and better treatment and more specialist doctors.”

He sought to blame international financial turmoil for an expected downturn, with a cut in projected growth, but insisted Britain was better prepared than other countries thanks to the Government.

And support for troubled Northern Rock had staved off wider problems within the banking system, said the Chancellor who played down the impact on the public finances of taking the North East-based bank into public ownership.

Mr Darling’s very flat delivery may even have been part of an attempt to show that Labour was serious about the need for stability as ill financial winds blow across the world.

The Chancellor also tried to be a friend to all within tight spending constraints. He promised help for pensioners, people struggling with rising fuel bills and action to cut child poverty – which raised a cheer from Labour MPs.

He attempted to paint the Government in a friendly green
hue with measures to help the environment, including a showroom tax on gas-guzzling cars and a headline-grabbing plan to get rid of plastic bags.

Environmentalists will be disappointed that he put off a 2p fuel duty rise in a move that may only please motorists temporarily.

Drivers will be angered by a lack of spending on North East roads and that Mr Darling signaled they could be subject to a national congestion charging scheme in the future.

And it remains to be seen whether voters will have been persuaded by Mr Darling’s plans, although local elections in May will be the first real test for the Government.

The Chancellor insisted the Government had transformed the country for the better.

Click here to see how the Budget will affect you

There wasn't a lot for the North East

FAMILIES in the North East, as elsewhere, will be forgiven for being vaguely underwhelmed by Mr Darling’s first Budget.

As well as overlooking the region’s transport concerns, there was no promise this year to close the North-South economic gap or ensure all parts of the UK prosper equally.

The Chancellor instead produced a Budget which will leave many families slightly better off, provided they do not smoke, abstain from alcohol and are prepared to drive less from October onwards.

The Conservatives have insisted the Budget is bad news for families, and accused the Prime Minister of failing to put aside enough for a rainy day.

Alan Duncan, the Tory’s shadow Tyneside minister, said: “This region needs more entrepreneurs and this Budget is just not robust enough to help them. It’s not good enough for the North East.”

In many way the Budget was never going to hold many surprises for the region.

Last year’s Sub National Review has already set out the economic focus for the region, and the three-year spending plan laid the path for public spending in the region up to 2011.

There were, however, some announcements yesterday which will trickle down to the region.

The £60m of additional funding for adult skills will potentially benefit up to 482,000 adults with low qualifications in the North East.

And the increase in the first child rate of Child Benefit to £20 a week from April 2009 will help 175,000 families in the region.

As with the rest of the UK, the big winners are the elderly, whose winter fuel payments have gone up just as the fuel companies increase their bills. Regionally, around 400,000 households will benefit.

Sarah Green, regional director at the CBI North East said: “On the surface there are
no nasty surprises, but his growth assump- tions are optimistic and leave him with no room for manoeuvre should things take a turn for the worse.”

PAGE TWO: Transport and binge drinking