Exactly 1 month till the Budget: 6 things you need to know

It’s exactly one month until the Spring Budget on Wednesday 8 March 2017.

What do you need to know?

• If you are trying to get something over the line, keep the focus on HM Treasury

Tax policy is one of the few areas where the usual negotiation and consultation with Cabinet colleagues is abandoned. This is the remit of the Chancellor, and most will only be briefed on the Budget in full a couple of hours before the public. There is no provision for collective discussion. Whilst good public affairs usually focusses on securing and demonstrating breadth of support in government, in these final weeks it all rests with the Treasury.

(For a more extensive critique of the Budget making process see Institute for Government's 'Better Budgets' paper)

• This is the last Spring Budget, and there will be another this Autumn. 

In November 2016, the Chancellor announced that the Budget would move to the autumn from 2017. He wants a more considered and well planned process, and to take officials off “the treadmill of producing eye-catching announcements twice a year” (see HMT guidance and Institute for Government’s commentary).

In future, there will be an autumn Budget, and a Spring Statement, both coinciding with the Office for Budget Responsibility’s twice a year forecasts.

• The last time we had two Budgets in one year, when it was not an election year, was 1993.

In 2010 and 2015 we were ‘treated’ to pre-election budgets in March and post-election budgets in June and July respectively. These followed quite naturally from a change in government, first from Labour to the Con-Lib coalition, and then from the coalition to the Conservatives.

This is a rather different pattern and the relevant historic example is 1993. The March Budget under Norman Lamont (the last spring budget until 1998) was followed by Kenneth Clarke’s in November.

(see House of Commons Budget debates and Finance bills since 1968)

• Businesses may be caught on the hop this year

With two Budgets and two Finance Bills, businesses need to be aware that measures could come into force with little scrutiny.

If we use 1993 as a template, we can expect the first Finance Bill to be passed before the summer recess, allowing HMT to start preparing for the second Budget.

If the Chancellor chooses to follow this pattern, a wise decision would be to save more for later in the year, and to use a short Finance Bill for any measures that must be in place for April 2018. 

• It’s likely to be a cautious Budget

The approach outlined above would also be in keeping with the Chancellor’s naturally careful style, reputation for steadiness, and the demands of the political environment. With Article 50 shortly to be triggered, the Government and the Prime Minister have enough to deal with without a controversial budget. Expect civil servants to be checking that every t is crossed and i dotted, with ‘pet’ policies given short shrift.

• Consultation should improve in the future, if businesses are alert

Most measures saved for the 2017 Autumn Budget will be consulted on in spring 2018, with draft legislation published in the summer, before legislation is introduced after the following budget. A consultation is expected on how to allow for earlier involvement on “key strategic challenges”. The key challenge for business will be knowing when a consultation is underway and taking the time to make their views heard.