With the Budget just a week away, Newington's Katie Milne looks at what the Chancellor may be planning.

The extent to which Chancellor Philip Hammond MP intends to tug at the nation’s purse strings when he delivers the Autumn Budget on 22 November remains to be seen. Stagnated productivity and inflation at 3%, combined with a lack of a Conservative majority and Brexit uncertainty, point to a relatively quiet Budget for tax measures and less focus on deficit reduction. Still, the Chancellor may seize on bold reform as an opportunity to win over younger voters and reset the Government’s narrative following recent resignations from the Cabinet.  

Speculation points to the Chancellor cutting stamp duty for first-time buyers to address the inter-generational unfairness perceived by those who are unable to join their parents on the property ladder. However, whether the Budget will fulfil the Prime Minister’s party conference pledge of fixing the “broken housing market” is uncertain. Following disagreement between ministers, the Chancellor is not expected to provide a comprehensive solution nor concede to proposals made by Communities Secretary Sajid Javid MP for a £50 billion housing investment fund.

Known for his cautious fiscal approach and support for a “soft Brexit”, business is looking to the Chancellor for more certainty.  He is widely expected to detail the Industrial Strategy Challenge Fund announced in the 2016 Autumn Budget and make some positive noises around business rates, including increasing it in line with the Consumer Price Index - rather than the Retail Price Index, which is higher.  Although, with the Patient Capital Review due to report at Budget, the Chancellor may also be considering revisions to tax benefits for venture capital trusts, particularly around the Enterprise Investment Scheme.

There is little doubt that the Government needs to deliver a convincing budget, but whether it will strike the right balance between appealing to young voters, restoring the Prime Minister’s authority and yielding to the demands of Conservative MPs is questionable, particularly given the constrained fiscal environment.

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