As impossible as that may seem, there is a week in British politics in which Boris Johnson is not taking center stage. All eyes are on a man who is 1.70 meters tall and extremely thin poor Raised in California, a billionaire by the family and a convict Thatcher, he is responsible for controlling the accounts of a government led by a prime minister who tends to spend as if there is no tomorrow. Rishi Sunak Advisor (The finance minister) from Downing Street will present his first post-pandemic budgets on Wednesday, along with a spending cap for the next three years.
Information provided from the end of last week indicates that deshi reishi (Sexy Rishi, as he is known among his many fans) will open a three-ring circus. Initially, you will maintain the spending your boss wants to correct the inadequacies of the National Health Service (NHS, in its English acronym), and balance investments in infrastructure across England. Referring to the so-called Red Wall Labor voters who in 2019 indulged in Johnson’s magic. In the second, it will try to control the monsters of the hard-line wing of the Conservative Party, which is considered a betrayal of their core by the increase in the corporate tax already announced in March (from 19% to 25%), and a 1.5% increase in social security contributions (National Insurance).And in English term).
Sunak warned his critics at the Conservative Party conference in Manchester in early October: “Of course I want to cut taxes, but to do that we must first put our public finances on a sustainable path.” “Reckless ideology is a very dangerous thing. I care about what shows its usefulness and not the purity of any dogma.” And the third proof: Reinforce Johnson’s promise that the post-Brexit era will bring an economy with higher wages and more skilled workers.
At the moment, the minimum wage, which the UK measures by the hour, will rise from 10.50 euros / hour to 11.27 euros / hour, for workers over 23 years old (here are the categories of 21-22 years and the apprentice, which will also increase). Sunak told the BBC that a 6.6% increase, more than double the current 3.1% inflation, “leads to the stated goal of ending low wages by the end of this quarter”.
More than 8000 million euros have been earmarked for transport infrastructure in northern England, the area hardest hit by a decade of austerity; And an additional 7,000 million, to be added to the 14,000 already planned thanks to a tax increase, to end inefficiencies, delays and waiting lists (more than five million patients) in the National Health Service. The level of public spending envisaged for the next three years (what is left of the legislature, if there is no electoral progress) represents an average increase of 3% per year. A rhythm reminiscent of the joyous new years of work for Tony Blair and Chancellor of the Exchequer Gordon Brown.
But it’s a misleading number, because the bulk of the money will go to the NHS, which is an endless hole (about 40% of the budget). Public education, local governments, the police or the Department of Justice will not recoup their income even by far the 20% of the cuts they took from years of austerity imposed by David Cameron’s conservative government. “The real problem is that spending can happily grow at 3% per year while the economy is growing at the same rate,” warns Paul Johnson, director of the Institute for Fiscal Studies, a financial studies think tank. “But these are not expectations that are being addressed, among other things, due to the negative effects that Brexit will continue to have. Additionally, with a very aging population under pressure and a starving NHS, Sunak may not be the last chancellor to raise taxes. At the same time he is forced to look for money to support other public services, warns the economist.
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Sunak is playing with expectations of recovering from the pandemic faster and stronger than initially thought, which will reduce the level of indebtedness calculated just one year ago and allow the minister to get some additional money to keep the continued promises of his boss, Boris Johnson. In turn, he strongly resists the idea of new confinement, despite the current alarming numbers of infections (about 50,000 per day). And he doesn’t even want to mention the possibility of having to use a file Job Retention Scheme (job retention program), A program similar to Spain’s ERTE but more generous, as it has involved spending over €80,000 million.
The tension between the UK Prime Minister, resident of No. 10 Downing Street, and his chancellor (neighbor of No. 11), is historic. If the former controls the political leadership and was First in equals from the government, The second The bureaucratic apparatus of the state is controlled by a strong central authority. However, Sunak was a replacement for Johnson, when, just before the pandemic, he decided to get rid of his predecessor, Sajid Javid (today responsible for the Department of Health). Despite his immense popularity, as evidenced by the conservative Congress in Manchester, and the fact that all the pools position him as a potential replacement for Johnson, he tries not to alarm his boss, who is not used to stage sharing.