UK Budget: As Jeremy Hunt does his Gordon Brown impression, Scotland needs a national insurance cut more than a reduction in income tax – John McLellan

A cut in national insurance will benefit people in Scotland because that’s not controlled by the SNP

National Insurance or income tax, or both? A 2p or a 1p cut? Speculation about what rabbits Chancellor Jeremy Hunt will pull from his Budget hat will end tomorrow lunchtime, although he’s managed expectations to the point where it wouldn’t be much of a shock if he did nothing at all.

While doing nothing in an election year when around 20 points behind in the polls is a non-starter, now that the latest survey puts the Conservatives on 20, not just 20 adrift, even a massive tax giveaway might not make voters deserting the party think again. On Sunday’s TV rounds, Chancellor Jeremy Hunt sounded uncannily like his predecessor Gordon Brown and his “prudence with a purpose” approach, except this time the purpose is rescuing the Conservative reputation for sound economic management, when in 1998 the Labour Chancellor was trying to establish one, much as Rachel Reeves is attempting now. On Friday, the Office of Budget Responsibility slashed his £30 billion headroom to £12.5bn, from the £30bn it estimated he had in November, and weekend reports estimated he might only have £6bn once reserves are taken into account.

Poll after poll indicates it won’t make much difference to the general election outcome because it will take a lot more than a penny tax cut to narrow the yawning gap Labour has maintained since the end of Liz Truss’s disastrous premiership. The latest Ipsos poll indicates beating the Lib Dems would be an achievement.

Chancellor Jeremy Hunt, seen doing electrical work at a college in north London with Rishi Sunak, appears to have little room to manoeuvre on tax cuts (Picture: Daniel Leal/WPA pool/Getty Images)

Student-style rant

George Galloway’s Workers’ Party might pinch a few Labour votes in seats with a substantial Muslim population, but having won in Rochdale last week he can’t stand everywhere, and electing a government is very different to backing a travelling rabble-rouser whose constituency commitment is less than obvious. The lack of depth in Gorgeous George’s gang was exposed on Friday when he refused to appear on Radio 4’s Today programme and was replaced by one of his deputy leaders, another rejected former Labour MP, Chris Williamson, who treated listeners to a student-style rant about overturning the West’s military-industrial conspiracy. Maybe a Fedora would help.

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Now confirmed as taking place this year, a late autumn election is a racing certainty, despite strong odds that rather than Houdini, Rishi Sunak is a hostage to adverse fortune. Although tomorrow’s budget is clearly crucial to the Prime Minister’s election strategy, it’s likely only to be an amuse bouche for announcements later this year, with Treasury officials already engaging with key financial organisations about the content of the Chancellor’s Mansion House speech to the City of London, traditionally in early summer. That points to an Autumn Statement containing the real pre-election heavy artillery in October, and voters getting their say in November.

Scottish Conservatives, comparatively chipper at their weekend conference in Aberdeen, have everything crossed the sweeties Mr Hunt throws out tomorrow will involve a reduction in National Insurance, but if it’s got to be income tax then that it’s through raising the personal allowance which the Scottish Government doesn’t control. Adjusting the rates will do nothing for Scottish workers earning over £28,200 a year who already pay more because the SNP won’t pass it on.

Looking down the back of the sofa

There is a view that income tax has a bigger psychological impact and, as NI isn’t paid by pensioners, the political gains from cutting income tax are potentially greater, but gaming tax cuts for marginal political advantage looks increasingly pointless. NI was cut last autumn and the effects are only now filtering through, but a further NI cut is not just cheaper and UK-wide, but reducing employers’ contributions should be better for growth.

As growing the economy is number two in the Prime Minister’s five pledges ─ and number three is bringing down the national debt ─ it surely makes more sense to cut NI to give the economy a lift and fund a more impactful pre-election income tax cut from improved tax receipts. Other measures floated in the weekend papers, like ending non-dom tax status, a tax raid on second homes used for holiday lets, and a vape levy, smack of searching down the back of the sofa and even a 1p cut in income tax costing £7bn will be pushing it. A 2p NI cut costing £9bn looks the better option.

Whatever Mr Hunt does, the SNP is guaranteed to moan, and despite Scottish Finance Secretary Shona Robison arguing against tax cuts in favour of protecting public services, as if the two are mutually exclusive, she too will benefit from an income tax reduction because of a Barnett formula boost which she can spend as she sees fit. Or spaff against the wall, as some would argue.

SNP’s deflection of responsibility

After a weekend in which the chief executive of housing and homelessness charity Shelter, Alison Watson, ripped into the Scottish Government for its 26 per cent cut to the affordable housing budget, Ms Robison should be desperate for money to quell the fury amongst housing organisations, both commercial and Third Sector, about the impact of that decision. Ms Robison is not used to accusations of “gaslighting”, a term more commonly used in association with domestic abuse, and the combination of that and the bitterness created in local authorities by the under-funded council tax freeze has put the Scottish Government under more pressure than at any time since the SNP took power in 2007.

Humza Yousaf might take comfort from last week’s Survation poll which gave the SNP a five-point lead over Labour, up two points to 38 with Labour on 33, but that might reflect the Gaza row, led by Westminster leader Stephen Flynn. More attacks like Shelter’s and the boost could be short-lived, but the real significance of that attack is it was made at all. The omerta the SNP has enjoyed in Scottish civil and business life is over, and so too is their deflection of responsibility. They will attack Mr Hunt tomorrow, but how many undecided voters will be listening? A new era is dawning.