Earlier this evening the directors at Keeble Brown, Jane Cozens and Spencer Neal sat down with the team to share notes. Like all Budgets, the significance of the UK’s first proper budget in 19 months will only become apparent in the coming months, but that is no reason to hold back from offering up some thoughts.
In case you missed it, today was Spring Budget Day. Now everyone is picking over the Chancellor’s Budget Statement and dissecting his Red Book, which sets out the detail behind the Budget Statement.
Of course, the most obvious ‘hot take’ is that this time the UK government stage managed the whole show from first draft to opening night. There was no drama, very little drum roll and not much more than a single act. In fact, unlike many Budgets, this was not so much theatre as a lesson in Corporate Comms 101.
Most of the bad news was downplayed and released early. A combination of well-rehearsed leaks and briefings meant that Chancellor Hunt could omit mentioning the cuts to infrastructure like HS2 without fear of howls from those who worry that without the new modern mainline growth will be reduced. Jeremy Hunt wished to tell a narrative of growth, and the delays to HS2 would have served as an out of place subplot.
Instead, the Chancellor promised a £8.8 billion allocation for City Region Sustainable Transport Settlements. Enough money to win some smiles but do not expect the northern regions to be getting out the bunting quite yet.
Another nod toward those that see more devolution as a necessary step towards growth, news that some city mayors will be able to take responsibility for social housing might win approval from some. To some of those in the know, this will seem a bit like a poison chalice unless it comes with seeds for a new money tree.
Mr Hunt also introduced his new investment zones, he dubbed the “12 potential Canary Wharfs,” with eight possible areas in northern England and the Midlands. These areas can apply for a grant of up to £80 million. Cynics might point out that the Canary Wharf quango agency received more than £1.8 billion in government funding to get it going. History buffs will also recall that HMT refused to be relocated to the Canary Wharf.
While Jane noted that there’s not much to encourage our clients’ senior leadership in the housing and development sectors, which is unfortunate given their challenges, the Chancellor does seem to have delivered on his well-trailed primary objective: never mind the nay-sayers, declinists and nags, think about the markets.
Of course, almost everyone needs certainty in order to manage their organisation, this is true for our clients in the public sector as much as it is for those in the commercial sectors. Local authorities, housing providers, transport business and specialist accommodation developers need to make business plans, and all need steady inflation, steady interest rates and steady markets for skills, supplies and regulation.
The initial signs are that insofar as a Chancellor can achieve anything in a single budget, Mr Hunt has done well (notwithstanding that the FTSE was suffering from SVB-related jitters even as he delivered his Statement).
If the Budget event was a musical production, it’s fair to say that a few feet are tapping along to the tunes. But whether anyone will be dancing in the isles, it’s far too soon to say. In fact, to revise our initial comment, we won’t know how this Budget plays out until the next General Election.
