As I write this Jeremy Hunt, the Chancellor of the Exchequer is about to present his speech to the Conservative Party’s conference, writes David Little, a partner in our Corporate and Commercial Law team.
He’s always struck me as a prudent and pragmatic person. Somewhat lacking in charisma, in fact an ideal candidate for the role. Rachel Reeves, Labour’s hopeful Chancellor in waiting, seems to me cut from the same cloth, although I’ve never met her.
This party conference season is interesting – or important at least – because in all probability it’s the last occasion either party will have to trim the sails of their direction of travel ahead of the next general election.
It intrigues me that both parties appear to be coming together at least on the how the UK economy needs to be managed. Writing in the Financial Times, the Shadow Chancellor makes all sorts of commitments that just appear to look like Tory promises.
Rachel Reeves is so keen to be seen as fiscally sensible, that she says she will “guarantee in law” that changes to government tax and spending will be subject to an impact forecast from the OBR (Office for Budget Responsibility).
Now, I’m a lawyer, so this might sound rather counter intuitive, but why make it a matter of law? What makes the OBR the font of all knowledge? Doesn’t it ever get it wrong? (err, yes…).
Chancellors have so little wriggle room as it is, so why give up the chance to say, Labour disagrees with the OBR and we are steering a different course?
She goes on: “We will reduce the National Debt as a share of the economy. I am clear that these rules are non-negotiable. There will be no exceptions.” So sounding, very like Jeremy Hunt.
Reeves has no way of knowing what might happen that requires a sudden spending round that takes debt up, even temporarily. For example, a new pandemic..
I wonder how pleased she was to learn that former Conservative Chancellor George Osborne has backed her “sensible” OBR reforms.
Sometimes it is frustrating how little Labour has to say, but when they do you are reminded that less is often more.
David Little is a Partner at Bishop & Sewell in our expert Corporate & Commercial team. If you would like to contact him, please quote Ref CB424 on either on either 07968 027343 / 020 7631 4141 or email firstname.lastname@example.org.
The above is accurate as at 02 October 2023. The information above may be subject to change during these ever-changing times. The content of this note should not be considered legal advice and each matter should be considered on a case-by-case basis.