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tine of spilled beans | accountingweb | Budget purdah
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Whatever happened to Budget purdah?

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Hugh Dalton lost his job for leaking Budget plans back in 1947, but now Chancellors brazenly spill the beans ahead of the big day. Philip Fisher considers the consequences.

21st Nov 2023
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In the halcyon days of yore, the Budget was a major event. Amid the highest levels of secrecy, it took place once a year and the whole country seemed to be on tenterhooks – or at least every accountant was.

We all wanted to know what was secreted in the Chancellor’s battered red box. Indeed, it is not so long ago that AccountingWEB and some firms of accountants used to run competitions to guess the major changes, with a bottle of champagne (purchased before duties went up) a popular prize.

This all relied on Budget purdah, defined by Wikipedia as “the period after plans have been prepared but before the Chancellor of the Exchequer’s annual budget is announced, when they refrain from discussing any matters that have relevance to the forthcoming Budget.” It wasn’t just the Chancellor who refrained, everybody in the Treasury was sworn to silence as well.

Budget purdah was so significant that 76 years ago Labour’s Hugh Dalton was forced to resign after he made “an off-the-cuff remark to a journalist, telling him of some of the tax changes”.

Quaint and archaic

If this all sounds quaint and archaic, there was a purpose. As former Institute for Government guru Jill Rutter has explained, “Budget purdah was supposed to protect against potentially market-moving leaks of tax changes, which is what forced Hugh Dalton’s resignation in 1947.”

Those were the good old days when Parliament relied on a system of honourable behaviour by its incumbents and they largely obeyed.

All of that has changed in the current century, with Philip Hammond, George Osborne and Rishi Sunak (remember him?) lavishly leaking titbits to friendly newspapers, originally over the weekend before the Budget and more recently earlier and earlier.

Initially, these were limited and Chancellors always held back a number of rabbits to pull smugly out of the hat on the big day.

To spice up the drama, interested parties hearing the latest leaks would be left wondering whether they were genuine or the man in charge was bluffing about a heinous increase that he could then boast about failing to implement.

Leaking extremes

One might have imagined that this had been taken to its greatest extreme by Kwasi Kwarteng and Liz Truss, who blithely announced their plans to the whole world, with the unfortunate exception of the only people who really needed to receive advance information, the Office for Budget Responsibility.

Boy did they get their comeuppance, since the former Chancellor disappeared without trace, while his ill-fated prime minister has literally (used in the literal sense for once) become ridiculous.

It could be argued that Jeremy Hunt is going a stage further in 2023, although admittedly an Autumn Statement is not technically a Budget. However, since this one could conceivably be the last chance to cut taxes and curry favour with voters before the general election, it might be of great significance.

Mr Hunt hasn’t bothered to leak elements of his magnum opus. Instead, he has been offering interviews to the BBC, the Daily Telegraph, Sky News and, by the time this article is published, maybe a few other media outlets as well. Whether there is an element of bluff and some rabbits are being concealed will only become apparent when the Chancellor stands up to deliver his message.

Does any of this matter? It certainly reduces the excitement that we used to feel ahead of a Budget speech, which is a shame. More significantly, bearing in mind the underlying logic behind Budget purdah, there must be a risk that markets could be influenced or investors and businesses enriched as a result of this breach with tradition.

Replies (7)

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By Open all hours
21st Nov 2023 13:15

Never mind the halcyon days of yore, it’s just a matter of respect for the office you hold. Mr Hunt, like his predecessor has none.
The Speaker of the Commons is as weak as a kitten. It’s about standards which we once had and will never get back.

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By Postingcomments
21st Nov 2023 13:57

Well, it gives people whose job it is to fill up pages and pages with text something to waffle on about for 2 weeks.

Will he do this, will he do that?

I'll see what actually happens on the day and go from there. No point getting involved beforehand.

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By Tom+Cross
22nd Nov 2023 09:58

When you're a spent force, does it really matter.
The sooner Rishi and his barmy army leave town, the better.
Although with Sir Starmer having previously reached the lofty heights of the civil service, I doubt whether his administration will have the force, which the country so desperately needs.
There needs to be a workable policy for those who live on the streets, seemingly with no hope and for those who live in poverty. Many people in the UK need a kind arm around their shoulders, to make them feel worthy.
Now that news would be worth leaking, in my view.

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Replying to Tom+Cross:
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By Open all hours
22nd Nov 2023 11:51

Yes I believe it still matters. Spent force or not. Why does that entitle you to trash the reputation of the office you hold?
The Speaker should remove Mr Hunt from the Commons at 12.29 and get some authority and order restored.
A curse on all their houses, Ms Reeves copies out Wikipedia in order to put her name on a book so there’ll be nothing to gain from installing her.
Hardly a single original thought between the 650 of them.
Doomed I tell ye…

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By gerrardb
22nd Nov 2023 14:07

It also gives undue influence on decisions to the press details are leaked to

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By vstrad
22nd Nov 2023 15:00

I think you'll find Philip, like so much else that's wrong with politics today, it was Gordon Brown who mastered the art of pre-Budget leaks. Strange you didn't give him a mention.

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Replying to vstrad:
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By Open all hours
22nd Nov 2023 20:40

You’re right Brown was also responsible.
What gets me is that they all think they’re better but not a single one of them is capable of doing the right and decent thing.
It’s all just a petty point scoring exercise.

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