CITY AND SUBURBAN
The Chief Secretary talks a good game but has yet to play one
CHRISTOPHER FILDES
Anong the malign consequences of an autumn Budget is that the preliminary skir- mishing goes on all summer. Ministers hurry back from the Dordogne or defer their departure for Tuscany to leave coded messages on Westminster's Ansafones. Please speak after the bleep: 'We are not going to forget that we are Conservatives': oh, yes, that sounds like Michael Portillo, so what he must mean is 'Cut spending'. The Chief Secretary talks a good game but has yet to play one. He is the Treasury min- ister responsible for the control of public spending, and his last year's round was a disaster, which is one reason why this year is looking so difficult. The other is Norman Lamont's post-dated cheque of a Budget, which put off revenue-raising to another day and another Chancellor. Now his col- leagues are busy lobbying and debating: should he raise taxes or should he cut spending? The answer to this question is obviously: both. Kenneth Clarke himself came closest to answering it before the Commons Treasury committee. The Bud- get deficit, he said, was the biggest thing he had to tackle, it would not cure itself as the economy recovered, and it could not be left any longer. As for taxes, he liked them indi- rect, with low rates and few exceptions and broad bases, on the principle (which I think was Colbert's) that sheep should be sheared little and often. He must surely have his eye on the anomaly of zero-rating. This spares businesses like newspapers and magazines from charging Value Added Tax but lets them reclaim VAT from their pay- ments to suppliers — setting up whole departments for this unproductive purpose and accumulating mountains of receipts and invoices. I fear that Rupert Murdoch has ruined his and our chances of getting away with this for much longer. If he can afford to cut his prices by 40 per cent, he can afford to pay VAT.
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