ALEX BRUMMER: Labor’s Rachel Reeves steals conservative clothing
- It would allow the Labor chancellor to follow Rishi Sunak with a furlough scheme
- Labor Chancellor will still be able to make policies on the fly without consulting the OBR
- Plus ca changes, plus c’est la meme chose
The Labor Party used the anniversary of Liz Truss’s explosive mini-budget to dress up the role of the Office for Budget Responsibility.
Unlike austerity, the creation of the independent OBR is a George Osborne initiative that Rachel Reeves can support.
The shadow chancellor promises to make it law that “permanent changes to tax and spending” will be subject to OBR scrutiny.
What Reeves did not mention was that the OBR offered to do a rapid assessment of Truss-Kwasi Kwarteng’s fiscal and spending commitments, but the proposal was rejected. The Conservative right believes the OBR is the Treasury in disguise. Truss and Kwarteng didn’t want him to mark his homework.
The refusal to take a look at the OBR was one of the reasons gold-edged stock returns soared, triggering the crisis that forced the sacking of then-chancellor Kwarteng and the swift resignation of the prime minister. None of them (nor, one would say, the OBR) could have foreseen that pension funds would have become casinos by converting UK bonds, one of the safest assets on the planet, into derivatives known as liability-driven investments. (L DI).
Planning: Rachel Reeves vows to make it law that ‘permanent changes to tax and spending’ will be subject to OBR scrutiny
Reeves says Labor will commit to producing a single budget by the end of November each year, giving families and businesses time to plan before the start of the financial year in April. The idea that this is a radical new agreement needs to be discarded.
It was his Labor predecessor, Gordon Brown, who invented the concept of the pre-budget report in November for precisely that reason. When Brown announced a huge out-of-sequence expansion of spending on the NHS (which would later be paid for by a 1 per cent surcharge on national insurance), it was largely about shoring up Sir Tony Blair’s guns.
The word “permanent” is central to Reeves’ statement. It would allow a Labor chancellor to follow in the footsteps of Rishi Sunak with the Covid furlough scheme and Truss with his energy subsidy after Russia’s war against Ukraine. A Labor chancellor will still be able to formulate policies on the fly without consulting the OBR.
Plus ca change, plus c’est la meme chose.
Microsoft boss Brad Smith finally appears to have overcome Britain’s Competition and Markets Authority’s legitimate opposition to the tech giant’s £60bn acquisition of Call of Duty gaming company Activision Blizzard.
The breakthrough came when Activision committed to selling its cloud streaming rights to French gaming rival Ubisoft. Microsoft’s victory may now be in sight, but Smith has won few friends through his public attack on the CMA and Britain.
Its exaggerated criticism of the UK process has been an own goal, costing Microsoft millions of pounds in legal fees. In opposing the original deal, the CMA and its chief executive, Sarah Cardell, raised universal concerns about Big Tech’s desire to rule the world.
Past Silicon Valley acquisitions have often been a substitute for new ideas and an attempt to dominate markets.
There are still questions to be asked about Ubisoft’s deals and whether it is wise for so much power over the gaming world to be in so few hands. Fear of destroying open architecture prevented Nvidia from purchasing Arm Holdings. The EU is harshly punishing Google for its alleged abuse of advertising technology to dominate the advertising space.
The deal with Microsoft threatens to stifle a fledgling creative business, weakening the ability of game innovators to reach markets.
Microsoft has won a narrow victory. In the process, Smith and the company have caused considerable damage to their reputation.
Saudi Arabia’s sovereign wealth fund PIF likes nothing more than a fight, as we saw when its LIV golf franchise shook dollar bills and took effective control of the US PGA tour.
Now he has his sights set on wrestling and mixed martial arts champion Ultimate Fighting League. The weapon of choice is the smaller Professional Fighters League (PFL), in which he has invested $100 million. As with golf (raised by Phil Mickelson), a Saudi-controlled PFL could change the economy by tempting big-name fighters with contracts beyond the dreams of greed.
The appeal of mixed martial arts is the relatively small number of less than 1,000 competitors that makes domination possible.
Let the combat begin.