I am proud to declare myself as a fully paid-up member of the Philip Hammond Appreciation Society.
Indeed, I have already ordered my copy of the great man’s memoirs, which might be published far sooner than anyone had expected on the basis that very soon he could have more writing time on his hands than had seemed likely last Wednesday morning.
Only when the man who has somehow got a reputation as a martyr to the spreadsheet dishes the dirt will we get the full story of how he managed to break a Tory manifesto pledge and a week later was obliged to do a U-turn on his banana skin.
There are so many questions that need to be answered.
- Was Philip Hammond aware of the election manifesto pledge when he stood up to address the country?
- Did Theresa May know that she was breaking a manifesto pledge?
- Was Theresa May told about Philip Hammond’s plans in this area in advance?
- Did either of them understand the consequences of what the Government was doing by increasing NIC for the self-employed?
As I say, the truth is unlikely to emerge while Mr Hammond is in office and quite possibly we will have to wait a few years after his departure to get the answers to these four questions.
Looking forward now, the Government is in a real bind. In the short term, it has a massive funding gap at a time when the economy seems to be in real trouble with the pound collapsing and some major businesses beginning to consider relocation to the European mainland.
In the longer term, the Chancellor of the Exchequer (whoever he or she may be through the remainder of this Parliament but let’s use the name Philip Hammond) has very few means of raising taxes at a time when economic uncertainty is likely to leave us all in a parlous state.
I think I can safely suggest that Mr Hammond will not consider increasing National Insurance Contributions, income tax or VAT, all of which were guaranteed to be outside his remit in the party’s manifesto, since any change in these areas will cause furore in the press, not to mention transport caffs (okay and in accountants’ offices) up and down the country.
As the party that delights in reducing corporation tax and inheritance tax, those also seem to be off-limits. What is left?
Having offended the white van man last week, taxes around vehicles are probably not going to be on the agenda either. Are we going to see insurance premium tax hiked up to 100% or a new windfall on banks? Bearing in mind both of these industries might be in the vanguard when the rush to Europe starts, such changes could be counter-productive.
This will be a real dilemma, leading to cuts to all kinds of public expenditure over the next few years unless Mr Hammond has the nous to invent a new tax or rebrand an old one to get around the manifesto pledge.
We live in interesting times.