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Pre-Budget report jitters

There is no doubt the opinion polls are getting interesting again and there is more than a touch of the jitters in Tory ranks. With several polls putting Tory support at less than 40 per cent – a hung Parliament scenario might be back on the cards.

This week’s pre-Budget report really is Gordon Brown and Alistair Darling’s last opportunity to seize back the agenda. And that agenda seems to be how to ‘out cut’ the Tories in terms of public spending priorities AND how hard to bash the City. Labour has been on quite a journey on policy since the party conference season.
 
Today Gordon Brown is set to unveil around £3bn in Whitehall ‘efficiency savings’. Watch out for the Tories later this week who will look to ‘out do’ this shopping list when it comes to the PBR – they will claim Labour is now signing from their tune.
 
Last week Cicero Consulting hosted an event with Conservative Intelligence where Shadow Treasury Minister Mark Hoban indicated the Tories would plan to look at a windfall tax on bank bonuses – and low and behold over the weekend the Government is also now on the same page.
 
But perhaps more worryingly for financial services – with not much in the kitty – there is already speculation that incentives for retirement savings may get clobbered this week. Capital gains also looks set to be a focus for the Chancellor.
 
There has been a battle royal inside Government between a Treasury that is looking for a Budget to restore the nation’s finances and No10 that wants a PBR full of electioneering opportunities for Labour’s base and to drive the distinction between middle Britain and Tory ‘toffs’.
 
If the British people are expecting to make a real choice in next year’s General Election – on the question of cuts the gap between the two main parties is narrowing on a daily basis. The issue that Labour want to focus on is one of experience – being tried and tested. The Tories want voters to feel it is time for a change.
 

I’ll be back on Wednesday following the pre-Budget report and we can see who might be better placed to win the affections of voters.

Cicero Consulting director and chief corporate counsel Iain Anderson

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