AT the time of writing we are awaiting the first budget by a Labour Chancellor since 2010 - and the first ever from a female Chancellor.But beyond the historic landmarks, it will also set the new government’s agenda for the coming years and tell us more about their plans for the country.
So far all signs are that we will see a significant increase in taxes, which would be the wrong approach in my view.
Thanks to the economic damage caused by the Covid pandemic and the impact of the war in Ukraine on the cost of living, we have already seen the overall tax burden rise to pay for the support programmes and stabilise the national debt.
Further rises could see taxes as a share of the economy reaching historic highs and there is a risk this stifles the economic growth which the government claims to be chasing.
I’m also concerned about the way the new government seems to be abandoning many of the commitments made by the Labour Party prior to the general election.
Rachel Reeves has confirmed she plans to change how the government measures public debt in its fiscal rules, to allow her to increase borrowing.
This is directly contrary to what she previously said she would do.
Similarly the Prime Minister and his colleagues have had to shuffle around how they define “working people” having pledged not to raise taxes on them.
They have not ruled out increasing employer’s National Insurance, despite their manifesto explicitly saying they would not increase National Insurance.
This also follows their decision just weeks after the election to announce they would take Winter Fuel Payments away from the vast majority of pensioners, which they previously said they had no plans to do.
I know many constituents in Central Devon already feel betrayed and misled.
What we really need to see at the budget is a plan to grow the economy and boost productivity, tax reforms to improve the incentives within the system, and to make the public sector more efficient and productive.
That also includes a bold reform agenda for our welfare system, one of the biggest pressures on the public finances.
I worry that the Chancellor is taking the easy ways out, simply raising taxes to pay for the things she wants, and hoping she can pin the blame on the previous Conservative government.
She has put much emphasis on a so-called “black hole”, a significant chunk of which is actually the cost of her own decision to award above-inflation pay rises across the public sector.
It is clear that the Labour Party were not being realistic when they made their commitments during the election.
They said what they felt they needed to in order to win, but have stored up problems in the process.
They wanted us to believe they would inject more funding into public services and infrastructure without raising taxes or borrowing more.
It should not have taken until now to realise their sums did not add up.