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\nChancellor Rachel Reeves on budget day<\/em><\/p>\n

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\nSo there we have it, Rachel Reeves\u2019s first budget, and altogether rather less gloomy than what had been heavily signalled almost since the day Labour took office back in July.<\/p>\n

Once upon a time, the contents of a budget were a closely guarded secret, to be revealed only when the chancellor of the day stood up to address the Commons.<\/p>\n

Back in 1947, the then Labour chancellor Hugh Dalton was forced to resign after details from his budget appeared ahead of his Commons appearance in that morning\u2019s Star<\/em> newspaper. He had briefed a journalist shortly before he stood up, not expecting this to be printed until afterwards.<\/p>\n

In 1996, 36 papers from the November budget were leaked in advance to the Daily Mirror<\/em>. Incredibly, the then editor Piers Morgan returned them to the government without publishing them, saying he had \u201ca public duty to return such sensitive documents\u201d. You can\u2019t imagine any editor doing that today. <\/p>\n

Since then, governments have taken to floating potential budget measures in the press to judge the public reaction. On a number of occasions for example, we have learnt that the government of the day was thinking of increasing fuel duty. Entirely predictably, the public was not keen on this idea, and no increase appeared in the subsequent budget. <\/p>\n

Naturally, no effort was made to establish how the newspapers in question got hold of sensitive budget plans. But then, as Yes Minister <\/em>noted, here we have an irregular verb: I brief, you leak, he commits an offence under the Official Secrets Act. <\/p>\n

This time around, we have learnt more in advance about the details of the budget than even before. It looks like the strategy has been to convince the public that the budget was going to be so terrible that on the day, it didn\u2019t seem so bad. <\/p>\n

Predictably, the Speaker has lashed the government for all its pre-briefings and reminded them that Parliament should be given such details first. He is wasting his breath. It suits the government of the day to make announcements outside the House where they can set things out in their own terms without awkward questions from other parties. The Speaker can huff and puff as much as he likes, but he has no sanction available to punish the government. <\/p>\n

As well as judiciously drip-fed announcements, this time we have been given more of a window into internal disagreements than normal, including the fact that at least three cabinet ministers including the deputy prime minister bypassed the chancellor and wrote directly to the prime minister to protest at projected cuts to their departments.<\/p>\n

I must say it seems quaintly old-fashioned to pen a letter? Why not just ring up the PM? But then a letter can be leaked. A phone call can\u2019t.<\/p>\n

It is very early in a government for this sort of indiscipline to break out and does not bode well. Starmer will need to get a grip, and fast.<\/p>\n

Another of the signatories was the transport secretary Louise Haigh, who was already in the PM\u2019s bad books. First, she was assessed to have given ASLEF everything they wanted from their long-running dispute while getting nothing in return (except the immediate announcement of further strikes), not even the small changes to terms and conditions that the Tory government had wrung out of them. Then she made the naive and cardinal error of assuming that a policy set out in opposition still applies in government, and attacked
\nP&O just as their parent company DP World was about to invest \u00a31bn in the UK economy. Cue frantic grovelling from the PM to salvage his investment summit of which this was perhaps the keystone. <\/p>\n

The transport secretary was therefore not in the best place to exert leverage on the chancellor on behalf of the DfT. Earlier this week, Starmer announced that the \u00a32 fare cap on bus journeys in England would be raised to \u00a33, and just for a year, with the implicit suggestion the cap will go entirely at the end of 2025. Some spin followed, suggesting that this was a triumph for Ms Haigh who had prevented the end of the cap. <\/p>\n

If this is a victory, it is a pretty hollow one. As sure as night follows day, this will put into reverse the painful recovery in bus passenger numbers since Covid. Transport Focus found that 1 in 10 were now using the bus more, and indeed bus journeys increased by an impressive 20% between March 2022 and March 2023. <\/p>\n

\u00a32.50 would have been tolerable, psychologically \u00a33 isn\u2019t. The saving grace is that some areas, such as London and Manchester, will exempt themselves from the increase<\/p>\n

\u00a32.50 would have been tolerable, psychologically \u00a33 isn\u2019t. The saving grace is that some areas, such as London and Manchester, will exempt themselves from the increase. <\/p>\n

We might also reflect on the fact that many bus passengers are relatively poor, and many use the bus to get to often low-paid jobs, but it seems this group of \u201cstrivers\u201d doesn\u2019t count.<\/p>\n

It doesn\u2019t even save the chancellor very much \u2013 the funding of the \u00a32 bus fare costs the public purse just \u00a3200m a year, a drop in the ocean in Treasury terms.<\/p>\n

But what really sticks in the gullet is the unfair and fiscally foolish decision to freeze fuel duty yet again. The chancellor herself said this would cost a further \u00a33bn next year, or 15 times the cost of the \u00a32 bus fare. <\/p>\n

Yet again the government of the day has pandered to the car and van driver while driving up the cost of using public transport. I note the Lib Dems have labelled the increase as a \u00a33 a \u201cbus tax\u201d. <\/p>\n

With rail fares going up 4.6% and rail cards planned to go up \u00a35, perhaps the government is imposing a \u201crail tax\u201d as well.<\/p>\n

The prime minister told the Commons today (Wednesday) that his government will be leading the fight to tackle climate change. Perhaps he can explain how driving reverse modal shift from bus to car helps that challenge<\/p>\n

Let us also remember that the transport sector is now the biggest sector when it comes to carbon emissions. The prime minister told the Commons today (Wednesday) that his government will be leading the fight to tackle climate change. Perhaps he can explain how driving reverse modal shift from bus to car helps that challenge. <\/p>\n

The measures announced by the chancellor to encourage the uptake of electric cars are welcome as far as they go, but without reform to fuel duty and indeed the adoption of pay-as-you-drive \u2013 now advocated not just by the Campaign for Better Transport but also motoring organisations and even the Tony Blair Foundation \u2013 the effect will be limited. And of course it does nothing for those who are dependent upon public transport. <\/p>\n

I did note, however, the big increase in Air Passenger Duty for private jets. This is actually an idea I came up with and put to Labour before the last election, though unsurprisingly I was not given a name check by the chancellor.<\/p>\n

What the 50% increase will do is to discourage carbon-busting private jets, and to extract a lot more money from those who nevertheless intend to carry on using such jets, people who can well afford to pay the extra tax. It is also welcome that there has been an increase, albeit a small one of \u00a32, to the economy rate for APD.<\/p>\n

It was good to hear from the chancellor a list of rail commitments, including for the Trans-Pennine route, with electrification of the Manchester to Stalybridge line, and from Church Fenton to York. There was also a commitment for East-West Rail, with Bedford reached by 2030, and electrification of the Wigan-Bolton line. There was also, thank goodness, a pledge to get HS2 into Euston, though no mention of the calls to get some sort of extension to Crewe. <\/p>\n

Further good news was the \u00a3650m earmarked for local transport funding (the same figure incidentally I secured for the Local Sustainable Transport Fund in 2010), with investment in, for example, the Sheffield Supertram.<\/p>\n

In terms of roads, there was \u00a3500m promised to deal with one million potholes, and thankfully no mention of huge new damaging road schemes, though as always, it will be worth checking what is in the published budget papers but not mentioned in the chancellor\u2019s speech.<\/p>\n

There is of course a Spending Review inked in for the spring, yet it would have made much more sense, at the beginning of a new government, to have combined these events, notwithstanding that we did get figures for increases in health and education spending. <\/p>\n

Overall, the budget was much less bad than feared<\/p>\n

Overall, the budget was much less bad than feared, and indeed had many positive proposals that taken together represent a coherent package.<\/p>\n

In the chancellor\u2019s budget speech itself, there was naturally a great deal from Ms Reeves about the toxic inheritance from the Tories, and with some justification. For instance, national debt as a proportion of GDP is at its highest level since the early 1960s, while the tax take as a share of national income has not been this high since the late 1940s. However it remains to be seen whether the public are willing to hold the Tories responsible for all this, or whether they will instead start to blame Labour for the choices they are making. The public are increasingly interested in the present, not the past. <\/p>\n

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\nABOUT THE AUTHOR: Norman Baker<\/strong> served as transport minister from May 2010 until October 2013. He was Lib Dem MP for Lewes between 1997 and 2015.<\/p>\n

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\nThis story appears inside the latest issue of\u00a0Passenger Transport<\/em>.<\/strong><\/p>\n