Budget polling

The budget is fairly unusual as an event that people actually pay attention to, and which actually has the potential to change voting intention polls. I spend most of my time hear stressing that the ins and outs of Westminster politics, the speeches, the gaffes, the policy launches. Hardly and of it is noticed by normal people who change their vote. Budgets are one of the exceptions – an annual event that does sometimes change minds. Regular readers will recognise the chart below from its outings at previous budgets – it shows the two YouGov polls before and after each recent budget (in recent years, its the weekly averages for the two weeks before and after each budget).

Effect of past budgets on government lead in YouGov polling

As you can see, while there is often talk of Chancellors revealing great vote winning bribes in budgets, when they do have an effect it is more often a negative one. Budgets can have a positive effect (2003, 2006 and 2011 all look like they shifted things marginally in the government’s favour), generally speaking the only big budget effects are negative ones – in 2008 and 2009 Alistair Darling had to deliver news of just how bad the economy was, while the 2012 budget contained the pasty tax, the granny tax and the 45p tax rate.

Anyway, while we’ll have the usual YouGov voting intention overnight, remember that the overwhelming majority of that will have been conducted before the budget was given. The actual figures we need to look out for will be those published Thurs/Fri night, and those published in the Sunday papers once the ups and downs of the budget have had time to register with the public.


278 Responses to “Budget polling”

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  1. I’d be very surprised if there was any change in voting intention after this particular budget. There doesn’t seem to be anything in it to change people’s minds about anything and the only thing that might have an effect is focussing people’s minds on the state of the economy.

  2. Will the tinkering with Cost of Living stuff-Fuel Duty, Beer Duty & bringing forward the £10k Tax Free Income threshold register?

    Everything got drowned out with Pasties last time.

    Depends so much on the Press he gets I suppose.

    Will he suffer there from Press Regulation overhang-none of them seem to want to join.

  3. Whether this budget shifts opinion or not depends rather on how the popular press play it tomorrow and Saturday. If they make a splash about a penny off a pint, child care, and buy your own home loans from HMG then it might show a slight rise in Con VI. I thought Milliband’s response adequate but not brilliant. He tried to use last year’s very effective challenge to ministers about their benefiting from the 45p rate. Last year it was brilliantly and devastatingly effective – this year it looked a bit stale and contrived. I think it will appear stale on broadcast highlights. He needed a new gag for this year, but seemingly nobody came up with one for him? I suspect after a week or two this budget will have zero effect on VI. Osborne didn’t box himself into omnishambles actions this time. It was a real “steady as she goes” budget IMO. You could argue either way that it was right or something more dramatic was needed to kick start the economy – but as for effect on VI? I suspect zero…..

  4. Apologies for the Groundhog event earlier.

    I agree with Laszlo.
    I also will not make the comment I made earlier because it has already been made (leaked) by me, if you follow me.

    I went shopping, instead of watching HoC debates. I noticed that, in Morrisons, petrol was down a penny to 137.9. Now that is the sort of movement that can shift VI. Well it would, if I had been 127.9. I can remember a decade ago, the whole country behaving not as we British were previously renowned for behaving, just because it went up from 84 to 87p. But that was after ‘Diana’ and I think all self respect went out the window after that era.

  5. TONY DEAN
    @”this year it looked a bit stale and contrived.”

    And overdone-too extended.

    Getting to the point when pointing & gesticulating at the Cabinet doesn’t seem like an adequate economic analysis & alternative ,

    ………..I thought GO seemed quite nervous & croaky.

  6. Colin – FPT.
    The 3% of GDP being debt interest payments is interesting.
    We have a had a conversation previously about this in relation to the tipping point beyond which capital markets are ‘spooked’ driving up interest rates which negates the benefit of increased borrowing. The interest payable on the National debt is more significant that the actual level of debt imo and is the number that must increase below a certain level to be sustainable given GDP growth over several years.
    We will disagree about the location of the tipping point but that is not the purpose of my post.

    I picked up in the coverage that the Government has to raise, I think, around £165bn in new borrowing next year with the excess of the annual defecit presumably being replacing maturing notes.

    First, am I right in this presumption.
    Secondly is it not the case that the replacement borrowing will be at lower interest rates than the old gilts (or bonds) which should help keep the interest payments/GDP number within manageable boundaries.

    RE polls expect no change due to budget, the measures may at some point but not todays event.

  7. I shall definitely be voting aspirationally in future – just as soon as I find out what’s involved and always provided it doesn’t require a lot of effort.

  8. Tony Dean
    ” this year it looked a bit stale and contrived. I think it will appear stale on broadcast highlights.”

    I think the line ‘but you ARE borrowing more’ where he was obviously replying to a comment from the Tory front bench will be the one that gets shown on the news.

  9. There was so much complicated detail in the budget that it will have nil effect.

    What the country needs is a dramatic broadening of the tax base, simplification of the system, removal of exceptions and exemptions, elimination of loopholes, and reduction in tax rates.

    Didn’t get any of these, only got more obfuscation, complexity and obscurity. Nobody will be capable of working out what it means for them.

  10. Anthony, I seem to have a non-partisan post stuck in moderation.

  11. @PAULCROFT

    aspelrationally – to be let down gently on the antique road show, i.e. Michael Aspel told me my commode was a reproduction and so worth very little.

  12. A huge gamble!! Of course even a modest rise in house prices could make a big difference in the marginals and by pumping money into the economy might get the economy going again. But it would be unsustainable growth reliant on increasing levels of debt, even worse that debt would be underwritten by the state. What happens when that unsustainablity becomes apparent? Or is that the plan, to leave the incoming labour govt with a ticking bomb? I fear that this policy will lead to many tears in the future

  13. Btw I agree with Laszlo both on the significance of the Budget and the claptrap heaved upon us about Cyprus. It would be interesting to know if some colleagues read how the foreign EU press are treating that latter issue. I think ‘with disdain’ sums it up pretty well. I read one issue of CDLS that didn’t even mention it, unless one delved very deeply. Grillo got a few lines though!

    Perhaps it was all because it is an UK base and there are all those ex-pats over there. The line about ‘flying over money’ was really hilarious. I wonder which Number 10 nerd dreamt that one up.

    Just like the Budget, it seems we are in political limbo does it not?

  14. Listening to vox pops on the radio things like the fuel duty thing and penny off a pint seem to be going down quite well. The house thing could go down very well. .. if it works. Nothing has gone pear-shaped yet. ..

    Telegraph are calling it a “last-ditch bid for growth. ..

  15. As usual, the impact (if any) on the polls will depend on how it plays out over the next few days. But there’s plenty of scope for omnishambles to make a return:

    The 3% NHS tax, and the 3% schools tax? Because that’s how much both these employers wage bills are about to increase by, due to the withdrawal of the contracted-out reduced NI rate.

    And there’s the cut in beer duty, which makes a nonsense of the recent discussion over minimum unit pricing.

    And there’s twittergate, the leaking of the entire budget in advance.

    Anything else?

  16. @JIM JAM
    “The 3% of GDP being debt interest payments is interesting.”

    ——–

    A year or two of decent growth would wipe that out. ..

  17. @Robin
    “Anything else?”

    —-

    Penny off a pint may fall foul of the EU. Maybe that’s what they want. “We really hoped to give you a penny off but sorry guys, those nasty faceless EU bureaucrats wouldn’t let us!!” Then Cam can pop to Brussels again to fight to defend our pint etc. ..

  18. JIM JAM

    I agree about the “tipping point” re Debt interest. Moody obviously reached it first.

    If there is any more significant slippage on the scale of peak Debt/GDP-and/or its timing, those doubts will become serious.

    Yes- I read the cash requirement as £165 bn next year.

    QE will presumably continue to help keep gilt yields down as you say.

    But OBR have taken all that into account in their DEbt Interest & Debt/GDP forecasts.

    I wish GO had written this Budget last year-it is much more focussed-and he has just lost a year.

  19. However, it’s starting to filter down that the ‘gift to the working man’ of 1p off on beer, isn’t a great amount. Only those drinking 14 pints a day might see a £50 saving.

  20. Following last year’s budget, it took about a week for the Cons to start to feel the pain of it – and it took 2 months for the full effect of the omni-shambles to knock them down to their lowest point.
    Interestingly, the 7-day weighted average for Con VI at their low point (May 2012) was 31.4.. they’re currently at 30.5.
    (Low point post budget in May 2012 with 30-day weighted average was 31.8.. currently at 30.9)

    So the starting point for Con VI at this budget is lower than the low point of the omni-shambles.

    From the look of the budget we shouldn’t see an omni-shambles situation developing, so we should know (excluding black swan events) roughly in a week or two the full effect of the budget.

  21. @ Richard in Norway

    ‘Or is that the plan, to leave the incoming labour govt with a ticking bomb?’

    That would be the Republican strategy in the US .. and we know how obsessed George Osborne is with American politics. This was also the most regressive budget of recent years (see IPPR graph on Left foot Forward) which is another feature of the Two Santa Claus’ stategy devised by Jude Wanninski.

  22. *Waves*

    Hello all. Glad it’s budget day, you’ll all be here.

    SORRY to hijsck the thread, but can anyone direct me to latest polling on Workfare – if there’s been any.

    I remember a flurry of polling when Workfare was much in the new over the forced/unforced row etc and Poundland, Tesco under pressure, but I don’t know if there’s been any since?

    At the time, I seem to remember people being very in favour when described as Work Experience, but didn’t support drop sharply when it was qualified as “Unpaid” or “Working for Tesco for free” etc?

    Again, so sorry to butt in, but if anyone could point me to anything more recent, I couldn’t think of a better place to ask.

    Sue

  23. I agree with Laszlo both on the significance of the Budget and the claptrap heaped upon us about Cyprus. It would be interesting to know if some colleagues read how the foreign EU press are treating that latter issue. I think ‘with disdain’ sums it up pretty well. I read one issue of CDLS that didn’t even mention it, unless one delved very deeply. Grillo got a few lines though!
    Perhaps it was all because it is an UK base and there are all those ex-pats over there. The line about ‘flying over money’ was really hilarious. Someone in No 10 clearly thought that would go down well.

  24. I thought I had a word wrong for auto mod and tried it again without, but it appears I had more than one. Apologies to moderator.

  25. Still digesting, but I’m with @Robin in my confusion over reducing the price of beer a week after DC told us we must deal with the scourge of cheap alcohol.

    In general terms, this budget has been written by pollsters and not economists. This may or may not be a bad thing. My feelings on beer and fuel duty are that Osborne is wasting his time (and our money) on these measures. I doubt beer will actually reduce in price, but margins will increase. Persuading voters to be grateful for not paying what they might have paid for a future fuel price rise that won’t now happen is a bit of a dead end, in my view.

    Child care stuff sounds catchy, and I’m sure will help many who will be grateful, but already the policy is making some enemies with it’s differential treatment of working/non working families and payments going right up the earnings scale.

    House loans – again, some families will really appreciate this, but over extending borrowings when interest rates are at record lows is a potential danger.

    So far though, for me, the stand out point is that I think this is the budget that confirms Cameron will lose the next election. I don’t say this because the budget was particularly dreadful, or there are nasty surprises that will unravel. It’s just that those borrowing numbers are truly dire, and the measures are ill focused and scattered, rather than being clearly targeted at the single big issue we need to face – growth. Just how does a penny off a pint create investment and growth?

    To say the deficit is flat lining at £120b is a slight misnomer – it’s plateauing, if we are to be more accurate. A massively high deficit showing no sign of falling. This removes Osbourne’s ability to boast about pretty much anything regarding his stewardship of the economy, and with the structural deficit set to edge upwards, he has admitted failure on his own metrics.

    More importantly than the numbers, which frankly won’t interest any normal voters, the creation of the OBR has finally driven the stake through his own heart, as I rather suspected it might.

    Chancellor’s of old could have adjusted cycles, fiddled forecasts, nudged the numbers, and attempted to bring in some sweetners for election time, in the hope that the markets wouldn’t notice until after polling day. The OBR is busy tying the concrete blocks to the drowning man’s feet, and the numbers they are producing are removing any hope Tories might have had to have something positive enough to offer the electorate by 2015.

    I find the slenderness of this budget striking. At a time when we needed a vividly imaginative budget with a vision for growth and an answer to the deep, deep crisis we are in, we had an empty budget from an empty man.

    Tinkering – nothing more or less than that. Hoping that the BoE can think of something is more an abdication of responsibility than an economic strategy, so probably the best you can say of this budget is that it’s a missed opportunity.

  26. The shale gas tax breaks & commitment to planning guidance this year seem to have had a positive market response.

    This fuel has been listed as one of three or four key aspects of USA’s recovery -and is shaping to make them nearly self-sufficient in energy by 2035, according to the International Energy Agency.

    Again though-why did GO lose at least a year in getting this sort of focus into fiscal plans ?

  27. Sue,
    Unfortunately I can’t find anything older than Feb 2012 (61% support) for workfare – which is probably far too old for what you’re looking for.

  28. If anyone is in any doubt that the elites are desperate to reinflate bubbles and keep them inflated they should consider the Japanese banks putting out a statement saying that they will use even bolder policy instruments, but what they said is not the point, the point is that they released this statement at 2.05 am Japan time! Perfect timing to ramp the American market. Lol

  29. ROBIN

    @”And there’s the cut in beer duty, which makes a nonsense of the recent discussion over minimum unit pricing.”

    If you had followed the debate , heard GO explain the source of the suggestion, and observed the smile on the face of Andrew Griffiths in response-you would have understood.

    It was nearly as big a smile as that unsuccessfully suppressed by Tristram Hunt, when GO gave him what he asked for , for his constituencies ceramics companies.

    Nice moments-both.

  30. @RiN

    Firstly, not all the spending is about demand. If you build houses and infrastructure, you get a boost to demand through wages etc. being spent in the economy but you also build assets that enhance productivity (or cut housing benefit costs etc) in a way that persists after you withdraw the stimulus.

    Also you the attract business investment and create jobs giving a further boost to demand beyond the government investment.

    Also… treating growth as cheating because it required borrowing is a bit strange.. that is commonly how people, businesses and economies grow their wealth. They borrow for mortgages, to expand a business or grow an economy. We usually run deficits even when growing… to get more growth.

    It’s normal investment practice which is why business, used to investment, encourage governments to invest in infrastructure.

    As for the debt overhang business is sitting on squillions they are not investing because no demand. Personal debt isn’t that big an issue if you can bundle it into a remortgage which is another reason the difficulties in buying a house is hurting us. Banks are being dealt with via your favourite: QE. But what’s really hurting is the living standards thing and the lack of pay growth that would erode debt, another reason to get the economy moving.

  31. @ Sue

    Last 2 questions of Sunday Times YG poll February 17th (Survey Feb 14th & 15th) have some polling following the outcome of the Cait Reilly case, if that’s any use to you.

    http://yougov.co.uk/publicopinion/archive/?category=politics&year=2013&page=2&month=2

  32. @AMBER STAR

    “I expect the fall in employment will be as inexplicable as the ‘fact’ that jobs were previously increasing despite output (GDP) being static.”

    ————–

    Oh I’m sure they’ll think of something. It’ll be snow or Labour’s fault or the meteor over Russia. ..

  33. @COLIN

    “Again though-why did GO lose at least a year in getting this sort of focus into fiscal plans ?”

    ——————

    We’re talking about the guy who gave us the pasty tax etc…

    That was his priority last year.

  34. Colin

    FPT
    “Debt Interest forecast now within a whisker of £60bn pa by end parliament !
    …that’s 3% of GDP-or half the total VAT receipts.
    Squeeky bum time.”

    I don’t understand. Govt debt interest was >3% of GDP for every one iof the years 1917-1999 with the solitary exception of 1992. We lived with debt interest levels like this in the past. Why should that same level be terrifying now?

  35. lefty

    It’s the new orthodoxy. Public spending BAD private spending ok…except that since we are prinint billions and handing it to privately owned banks it is impossible to tell what is public and what is private.

    Everything makes no sense.

  36. Colin
    “I agree about the “tipping point” re Debt interest. Moody obviously reached it first.”

    And the effect on bond rates was…?

    We keep hearing how the markets will get spooked and up interest rates. Eventually. When the debt gets too large. I’ve asked before if there is any example in recent history of a monetarily sovereign country ever being hammered by the bond markets because if the size of its debt.

    I’m still waiting.

  37. @Robin
    “there’s plenty of scope for omnishambles to make a return:
    The 3% NHS tax, and the 3% schools tax? Because that’s how much both these employers wage bills are about to increase by, due to the withdrawal of the contracted-out reduced NI rate.”

    More smoke and mirrors from Osborne. Public sector once again clobbered disproportionately, including this time the NHS and schools.

    It has by far the biggest impact of any measure, yet Osborne made nothing of it at all. Such is the sophistry of Budget speeches nowadays. £5.5 billion raised in 2016/17 alone. It impacts on employees as well as employers.

  38. @RC

    “No, it isn’t sustainable because it doesn’t do either of those things enough to make up for the amount spent in the first place.”

    ————

    Sure it does.

    Do the maths.

    We lost seven percent of the economy in the crash. That hit tax receipts and upped welfare hence gave us a nasty deficit.

    We had over 2 percent growth when Labour left office on an upward trend before the Coalition announced their cuts and started sucking demand out the economy.

    Let’s say Labour had been able to see out the plan and growth stabilized at just 3%. You’d get back the 7% you lost and are to where you were pre-crash in a little over 2 years and wipe out the deficit caused by the GDP hit in the process.

    With 2% growth it’d take something over three years.

    Not entirely: you’d still have the interest on the debt, currently equal to about 3% of GDP. Another year or so to wipe that part of the deficit too…

  39. LEFTY

    I would need to look at the comparatives for that period.
    I’m certainly not going to accept an equivalence with a period encompasing two world wars.

    But what is different this time is that Debt interest costs are being supported by QE. Sub 2% pa for 10 year money-when inflation eats that sum, is unsustainably low-whilst Debt/GDP is high & rising.

    There is huge risk in the system.

  40. A mixed bag from GO.

    It is true that the poorest 20% are worse off under this Budget, but the measures were so well presented, with the LDs income tax pledge the coup de grace, that the voters will probably see the Budget as positive.

    Take the house-buying move. It’s very attractive for first time buyers (ans more likely second buyers) to see the government stump up a 20% interest free loan for the purchase. The fact that this may keep prices artificially high (and therefore in reality continue to freeze first time buyers out of the market), and amounts to a £130Bn taxpayer subsidy to the private sector will not be noticed by most.

    The 10K pledge is political gold, although not necessarily for GO. If anything it could help the LDs hold off Tory challenges in the shires, and may also help the LDs in Scotland, Wales and parts of the North of England where earnings and the cost of living is generally substantially lower than in London.

  41. Carfrew

    Not sure how I should respond to your points because of course I agree that building low cost houses is a good idea, but then given my background thats not surIIIprising and of course there are lots of economic benefits, borrowing can be repaid and/or inflated away although the problem of giving money ie real resources to bankers purely for the service of printing our money fills me with disgust. But even if we were to embark on a massive house building and infrastructure program using newly printed BOE money I still wouldn’t think it was a good idea. I can see you pulling your hair out now at my stupidity but consider what happens when you fill the economy with all that money, yes I know economic activity goes to the moon because of the multiplier effect and that’s a good thing. Right? Except that it also means more people borrowing money, more debt to be serviced and then the govt removes the economic stimulus and then what? The reality of excessive private borrowing sets in again. the banks are insolvent again. they need nailing out again.. Because you have changed nothing about how the monetary system works and that system has got to a point that it needs constant stimulus, constant infusesions of new debt. Maybe if as Steve keen suggests half the private debt was wiped out, you could run this system for another 20 to 30 years without too many problems but then you are going to hit the same wall again but as it stands today I don’t believe it can be done. Sorry I’m still not being clear, I have real problems comunicating this but basically we need a new monetary system and without that all other policies are doomed to fail

  42. Lefty – I think you are making my point for me that the level of debt is less significant in terms of whether it is sustainable or not (or indeed could be higher in the short term) than the interest we pay on that debt.

    Clearly there is a tipping point beyond which new debt would be at higher interest rates and that is what imo the judgement call should be about. I think we are a long way from that as does it appears Dr Cable

    Unless one has an ideaolgical aversion to public spending unless absolutley necessary which is a legitimate position but one which the PM and CoE say they don’t ascribe to.

  43. It seems to me that the latest unemployment data has insignificant changes whereby it would be impossible to derive any conclusion other than a stagnation of this indicator.

    I think we all had this idea that the ‘shake-out’ involved people taking low skill part time work. The lowering over a year of just over 151000 is almost the same as the increase in private sector employment. I just wonder if it can be proven, one way or the other, whether these are Mcdonalds type jobs. A job is a job, but one does rather hope that my supposition is incorrect. My anecdotal experience says otherwise.

  44. Colin
    “But what is different this time is that Debt interest costs are being supported by QE. Sub 2% pa for 10 year money-when inflation eats that sum, is unsustainably low-whilst Debt/GDP is high & rising.”

    No! You are not having that. Bond rates have come down linearly for 20 years. From way before QE was even considered a remote possibility. They have come down regardless of debt and deficit levels and trajectories. And, crucially, they have come down in countries that HAVEN’T used QE.

  45. Just one other Budget point, this time on capital spending. The planning hoops that delay these projects are well-known but even those projects that do not have these hurdles, do require design and evaluation stages. If one were to order a fleet of suburban electric trains (we need oodles of these – right now) it will take years before they grace the rails.

    If I were a politician, I would establish a Capital Spending Cutting the Gordon Knot Ministry (perhaps).

  46. ‘Data have’ not has (9.03).

  47. @Lefty

    The argument seems to be. .. that they must do bad things to us just in case. .. bad things happen!!

    And then, even when the bad thing they were supposed to be trying to avoid – eg loss of triple AAA – happens anyway, then they must carry on doing bad things to us regardless.

    There is no end to the number of bad things that may happen that they can invent. Eg it was vital to clear the deficit in this Parliament to avoid the bad thing of interest rates on our debt rising. Thanks to their policies austerity is being extended years into the future. .. but interest rates have stayed low.

    It really is through the looking glass economics. Hardly anything of what they say actually happens. If they were that worried about the deficit they wouldn’t be spending billions on privatizing health, education etc. ..

  48. @Howard

    “I just wonder if it can be proven, one way or the other, whether these are Mcdonalds type jobs”

    Yes, it will be *theoretically* possible to do that with Labour Force Survey data. The question is when that will be available outside the Government. I would expect the Work Foundation to do that sort of analysis.

  49. Lefty,

    I think you are right, it has never happened. The idea that current government debt levels are too high is bogus. Japan has got to 200% of GDP without a crisis; the UK has been even higher in past history.

    So 70% or wherever we are now is nothing to worry about.

  50. In other news, here’s how UKIP reacted to Prof. Alice Roberts’ perfectly reasonable request to clarify their position on homeopathy

    https://www.facebook.com/pages/Alice-Roberts/116907601691195?fref=ts

    I’ll quote the last para:

    “I have no intention of entering into a lengthy debate with you on this matter. You are free to agree or disagree with our position but, with the huge surge in support for UKIP, we have much to do that will be more productive than extending this discussion.”

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