Jeremy Hunt's 2024 spring budget highlights our politicians’ pretence over public spending

Jeremy Hunt’s budget was based on entirely fictitious spending plans

As well trailed ahead of the big day, Jeremy Hunt used his spring budget to attempt to draw a dividing line between the Conservatives and Labour over tax – with a two pence cut in national insurance and a claim that Labour will have to raise taxes to meet their spending commitments. Labour’s shadow chancellor Rachel Reeves also responded as expected – avoiding the obvious political trap laid for her by the chancellor by promising not to reverse any of his tax cuts.

Though somewhat subdued, the budget proceedings had their typical theatre, along with the traditional smattering of laboured jokes from the chancellor (and some unfortunate fat-shaming). But the actual content of the chancellor’s speech and Reeves’ response was significant. Despite Hunt’s hints at a further fiscal event later in the year, the figures announced will probably now provide the baseline for the two main parties’ manifestos, shaping the policies they put forward to voters.

And yet the figures that Hunt announced – and to which Labour promised to adhere – are based on entirely fictitious future spending plans. In evidence to a Lords committee last month, the OBR’s Richard Hughes argued that the government’s plans were actually not even fiction – because it had not taken the trouble to write them down. As my colleagues at the Institute for Government and many others have highlighted, the idea that revenue spending increases can be limited to 1% a year for four years and capital spending can be cut by 10% is entirely inconsistent with promises to maintain the quality and coverage of public services which are already creaking.

Jeremy Hunt and Rachel Reeves are taking risks with their fiscal strategies

Frankly, Hunt’s budget looks like that of a chancellor who does not think he'll have to deliver on his pencilled-in plans. Previous chancellors who have made rash promises before their party unexpectedly won an election have discovered this to be a risky strategy – although the current polls suggest this is one problem Hunt doesn’t have to worry about. But it is also a mendacious strategy – deliberately glossing-over the medium-term implications of the notional choices he is making to balance the books and meet his fiscal rule.

Labour is taking a comparable risk by promising to match the government’s plans despite being aware of the shortfall in funding across numerous public services and policy areas. Ironically, given the record of the Conservative government over the past 14 years, Reeves is anxious to avoid Labour being cast as the party of tax increases. But should Labour win the election, any claim that the state of the public finances – inflation-exacerbated shortfalls in day-to-day spending and chronic underinvestment in infrastructure – is a matter of surprise to incoming ministers will be completely implausible.

Politicians who duck fiscal reality are causing big headaches for government

Meanwhile, the Treasury has confirmed that there will be no spending review until after the next election. As the Resolution Foundation’s Torsten Bell has said, this is "inevitable given that holding one would unravel the fiscal fiction of spending plans pencilled in". But the political convenience for both parties of avoiding laying bare fiscal reality ahead of a general election will further exacerbate problems across government. It means that there is no way for government departments and public services to plan their spending or to build in efficiencies that might be realised over a number of years.

Politicians will spend this year attempting to convince voters to entrust them with the privilege of running the country for the next five years. But what we have seen with the spring budget has been a bad demonstration of how to do government. The public is poorly served by politicians of both parties pretending their plans are affordable but making no attempt to explain how they will add up.

Watch our Inside Briefing LIVE episode on the general election budget