Budget 2017 - Lesson learnt?

Wednesday’s budget announcement had a few key talking points. The Government would probably have you focus on the new tax-free childcare scheme or the increased emphasis on apprenticeships, but the thing that has taken up the most airtime and column inches in the 48 hours since, has been the planned increase in National Insurance rates for self-employed workers. 

In its manifesto for the 2015 general election the Conservative party pledged not to increase the rates of VAT, Income Tax or National Insurance in the next Parliament. But in Wednesday’s budget, Hammond appeared to break that manifesto promise, and the so called ‘tax betrayal’ has caused outrage.

Whether you agree or disagree that increasing NICs is the right thing to do, one thing that can’t be argued is that the Government could have done a better job communicating this point.

As a general rule, people do not like change. And when that change has a personal impact, they like it even less. Another thing that people don’t like is feeling like they have been tricked, misled or lied to, so the Government’s argument this week that the rise applies to a class of NIC’s not covered by the promise, has only caused further upset.

In a world full of information overload, ‘fake news’ and cover ups, what people really want is clear, honest communication. In order to achieve acceptance of change, people need to have the full picture and understand the reasons behind it. They may not like the message, but they will respect you for telling the truth.

Anything other than that is just not good enough.