Who’d be Philip Hammond?

By Chris Rogers November 17, 2016 4:00 pm

Few people would argue that Prime Minister is a tough job. Similarly, Liam Fox, David Davis and Boris Johnson – the ‘Three Brexiteers’ – have got their work cut out for them. And Jeremy Hunt at the Department of Health is grappling with financial pressures on the NHS of epic proportions.

But arguably the man with toughest – and perhaps the least wanted – job in Whitehall over the next week is Chancellor of the Exchequer Philip Hammond. ‘Spreadsheet Phil’, as he’s been labelled in the past, has the unwanted job of giving his Autumn Statement to Parliament next week. When, according to the Financial Times, he’s going to report the worst deterioration in public finances since the Conservatives came to power in 2010.

That includes a supposed £100bn bill for leaving the EU.

The fact the media is carrying this news ahead of the Statement suggests the Government is attempting to manage expectations. But on this occasion, it’s unlikely to give the Chancellor much in the way of relief. To put this revelation into context, in 2010 the UK was recovering from the severest financial recession in the post-war era – arguably since the Great Depression, and perhaps ever. The pictures of employees of Lehman Brothers turned out of their offices onto the streets with boxes of their possessions were fresh in the mind.

The implications for this news are far-reaching. In terms of the Autumn Statement itself, the deterioration in public finances likely means Mr Hammond – despite his wishes to contrary – will have to use his speech as a second Budget. It seems entirely implausible that he’ll get his wish of using the statement as a briefing on the state of the economy. The state of public finances will necessitate him to not just say what’s happening, but also what he’s going to do about it.

The suggested bill for Brexit will add fuel to the fire, and Remainers will doubtless take the opportunity to suggest their concerns for the economy are being realised. While this won’t lead to any form of parliamentary revolt over the triggering of Article 50, it may lead to further demands from politicians and business leaders for Theresa May to explain what the UK’s position in formal negotiations will be.

The anticipated budget deficit will also present an opportunity to a Labour opposition that in recent weeks has struggled for attention against the backdrop of Brexit and the US election. Granted, with the Conservatives so far ahead in the polls, Labour has its work cut out. But, Jeremy Corbyn and John McDonnell can perhaps take some comfort from the anti-establishment sentiment clearly evident in the UK and US, and seek to use the Autumn Statement to capitalise on that dissatisfaction. And, while they’re at it, they can certainly challenge the Government’s insistence on its financial credibility, which has been something close to its mantra for the last six years.

Finally, of course, there are the implications for the domestic situation. The NHS is in dire financial straits but any demands for more cash are likely to be given short shrift. And while the Chancellor has eschewed the targets of his predecessor, the pressure will be on to tackle the deficit, meaning further austerity. Which, given the proverbial low hanging fruit has been picked, will present the Chancellor with some tough decisions to made in the face of pressure from Cabinet colleagues and all manner of business and public interests.

So, who’d be Philip Hammond?

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