A Cabinet minister has defended the pre-Budget process, saying it has taken place on “shifting sands” amid fears about the economic impact of the weeks of speculation about what it will contain.
Transport Secretary Heidi Alexander also declined to deny that the Chancellor is planning a pay-per-mile scheme for electric vehicle (EV) drivers, even as she boosts a grant that cuts the upfront costs for buyers.
Speaker of the House Lindsay Hoyle has criticised what he called the “hokey cokey” Budget and called out ministers for leaking key announcements ahead of the Chancellor’s statement on Wednesday.
Rachel Reeves abandoned expected plans to hike income tax rates after a press conference and behind-the-scenes briefings aimed at preparing the country for the manifesto-busting move.
The apparent U-turn was said to have come about because of improved economic forecasts.
Transport Secretary Heidi Alexander, when asked on the BBC’s Sunday With Laura Kuenssberg programme whether speculation about tax rises has damaged the economy, said: “The review that the Office for Budget Responsibility have done about the productivity forecasts has meant that this whole process has really taken place on shifting sands to start off with, and we’ve got a very challenging global economic environment.”
Former Bank of England chief economist Andy Haldane said the “fiscal fandango” of the past months had caused “paralysis” among businesses and consumers.
“Next week, we need a decisive action that puts to bed and beyond reproach any notion of further tax rises,” he told the programme.
Ms Alexander declined to reveal Budget details, but did not deny that drivers of electric vehicles could face a pay-per-mile charge as the Chancellor adds £1.3 billion to a grant cutting upfront costs for buying EVs.
She said: “We need a fair vehicle taxation system for all motorists, because EVs, like drivers of petrol and diesel cars, they’re driving on roads that require maintenance.”
The Chancellor has pledged to get a grip on the cost of…
Read More: Minister blames ‘shifting sands’ amid criticism of pre-Budget ‘fiscal
