Having slept on it, watched, and listened to the coverage of the Pre-Budget Report I think a conclusion I drew yesterday when the National Insurance increases were introduced is more true than ever.
That conclsuioon was that the 0.5% increas ein NI had just lost Labour quite number of marginal seats. Now the dust has settled that seems even more likely because anyone earning £40,000 a year, which is not actually alot of money in the scheme of things, will find themselves around £1000 a year worse off under the changes.
That change is going to have a direct impact on the very people in the marginal seats that Labour took from the Tories in 1997 and that they need to hold on to to win the next election. I would say that the NI change alone will lose those seats for Labour. Of course, they are gambling that people will "understand" they have to "do their bit". I personally don't think people think like that.
When a recession is going on, when the economy is tanking, what people look at is not the so-called "wider picture" but instead they just see the bottom line of their net salary. When they see that drop by just under £100 every month they will react. Let's just put that into persepctive, that's a weeks supermarket shopping on VAT exempt purchases for a family of four.
What's more, the tax credit changes for those people, if they even choose to take them out represent little more than pennies in a month. This mini-budget as such not only spells the death of New Labour but the I'd say the death of the Labour Government for the next term.