Cicero Group hosted a conference call to discuss Wednesday’s Budget Statement. Cicero Group’s Iain Anderson was joined on the call by Kiran Stacey, the Political Correspondent for the Financial Times, and James Plaskitt, the former Labour Pensions Minister and current Senior Political Counsel for Cicero Group, to provide analysis on the key measures announced and the implications for the upcoming General Election campaign.
Opening the call, Iain Anderson stated that while an easing of austerity was one of the Chancellor’s major messages, the numbers in the Red Book show that there are still harsh cuts to come in the next Parliament. Another key point to note in the Conservative spending projections is the handbrake turn being performed in 2018/19, with a sharp increase in spending planned for that year.
He also noted that in his response Ed Miliband led with the argument that the Chancellor is not on the side of ordinary voters. This is an effective message that continues to play well for Labour, alongside their arguments that the Conservatives will cut back NHS funding.
Kiran Stacey stressed that the most significant measure unveiled yesterday was the change in direction on deficit reduction plans, with Osborne turning back sharply from his previous predictions of a £23 billion surplus in 2019/20 to a more modest £7 billion surplus.
Stacey said that in his opinion this Budget won’t significantly move the dial of voter intentions. It was a typical Lynton Crosby Budget, which hammered home the Conservative messages around the economic recovery. The key question now is at what point will the Conservatives start to see an increase in their poll ratings, and will their messaging remain disciplined if this does not occur?
James Plaskitt noted that Osborne had failed to shoot most of Labour foxes with this Budget. By sticking to his one message strategy the Chancellor failed to address key voter concerns on issues such as the NHS, which is a risky strategy. He could have used the improving economy to make extra investments in areas such as this, but chose not to. He said that the true test of this Budget’s effects will not be seen in the immediate polls, but rather in voting intentions over the next weeks.
He also predicted that Labour will now focus on the sizeable public spending cuts which will take place in 2016 and 2017, emphasising the harsher nature of the Conservative’s spending plans. But he concluded that ultimately this Budget will not change the campaigning messaging for either party, with that framework having already been firmly set.
The conference call also covered a range of additional issues, such as the key implications for business from yesterday’s Statement; the future shape of the pensions landscape in the UK; the effect on voting intentions in Scotland; the implications for the Liberal Democrats; and the key challenges faced by the main parties in the run up to the Election. You can listen to a full recording of this call on the link below.