What does coronavirus mean for the Budget?
Final preparations for Rishi Sunak to deliver this government’s first Budget have inevitably been disrupted by the attempt to respond to the outbreak of coronavirus. After the post-reshuffle speculation that Sunak would shelve some of Sajid Javid’s plans for public spending, the new Chancellor is bound to have to make changes neither he nor his predecessor would have foreseen a matter of weeks ago to respond to the threat of coronavirus. While the Government’s longer-term policy positions are unlikely to change as a consequence – and any specific direct response announced at the Budget will be minimal – there will be a reluctance to prioritise immediate and wide-ranging financial measures at a time of such uncertainty for businesses. This does not mean that everything planned for the Budget will be abandoned, but some of the key tax and spend measures that might have been expected in Wednesday’s speech are likely now to be held back until the Autumn Statement in November.
NAO highlights nurse shortage
As the Government seeks to respond to the spread of coronavirus, news of its failure to meet nurse recruitment targets has inevitably made headlines this week. A report published yesterday by the National Audit Office – originally intended to address the issues raised in the now-delayed NHS People Plan – highlights not only the national shortage of nurses, but the large differences in staffing levels between individual trusts and regions. It also indicates that the Government is yet to meet recruitment targets despite a number of national initiatives to increase nurse numbers, and that trusts have found that there are a number of financial and structural barriers to taking on greater numbers of apprentices as part of improving recruitment overall despite national targets and the apprenticeship levy. We know that nurse recruitment is a key priority for the Government, and developments this week will only serve to move it higher up the political agenda.
McDonnell attacks ‘toothless’ Treasury Committee
Labour’s Shadow Chancellor John McDonnell has criticised the Treasury Committee – the cross-party group of MPs that scrutinises Treasury decision-making – for being ‘toothless’ as a number of its Conservative members have past links to the financial services sector. With membership of the House of Commons committees having been finalised this week, it is worth considering how their respective chairs and memberships will influence both their own agenda and the wider political debate. The new make-up of the Treasury Committee, for example, may well signal a greater interest in particular areas of the Treasury’s policy remit and encourage a shift in focus in the debate over financial services regulation and post-Brexit market access. It is important for businesses to consider where committees – which are likely to prove one of the most effective routes to influencing or opposing government policy in an environment where the executive has such a large majority in Parliament – might seek to pressure Ministers and which issues they will prioritise.
Jamie Cater, the brains behind a lot of GK’s thinking, leads our policy work across the entire business, supporting our strategic communications work and providing strategic advice to investors during M&A activity.