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Originally posted on WONKHE<\/a> on Monday, 9 March 2020<\/p>\n “To govern is to choose\u201d said Nigel Lawson, the former Conservative Chancellor. And this Budget is where the government of Boris Johnson really begins and where he must make choices about his real priorities as Prime Minister.<\/p>\n Since he became PM in July last year, his leadership has all been about the poetry of campaigning, playing to the gallery and constant political positioning. And he\u2019s proved to be rather good at all of them. But now the Budget heralds a new phase. Boris Johnson and his new chancellor Rishi Sunak must now begin to govern.<\/p>\n Since the resounding election victory in December and the relatively bloody ministerial reshuffle there have been few announcements or agenda-setting speeches, there have been no green or white papers. But they will come and drafting of plans and ideas is underway. The Budget will be the most important signal for each of them. It is the main policy lever showing how you intend to govern. What (and who) are your priorities? What (and who) aren\u2019t your priorities? This and the Spending Review in the Autumn must set these out and so choices must be made.<\/p>\n We know there have already been struggles \u2013 Sajid Javid deposed before he even delivered a Budget. After his sacking he claimed that his Budget would have delivered a 2p cut in income tax. Popular as that might have been with some parts of the Conservative Party it seems a highly unlikely scenario \u2013 and even less so the closer we get to Budget Day.<\/p>\n For this is a Budget that must raise funds and then decide how best to spend them. Javid did at least one service for No 10 by relaxing the fiscal rules for capital investment allowing some \u00a3100bn or so to spend on transport, buildings and infrastructure etc. His successor Rishi Sunak must now find a way to relax the rules on day to day spending if he is to find any spare resources to fulfil manifesto pledges on, amongst other things, nurses, schools, skills and R&D.<\/p>\n The domestic priority is \u201clevelling up\u201d \u2013 boosting economic growth, living standards and productivity in the Midlands and the North and especially in the former \u201cred wall\u201d of seats and places now controlled by the Conservatives after Boris\u2019s election victory in December. This won\u2019t be the first time that chancellors have tried to fix productivity or regional inequality \u2013 both Brown and Osborne (like Lawson, amongst the longest-serving chancellors) had their attempts but the politics of the referendum and the last election may make this more urgent and with more political support.<\/p>\n And yet Brown and Osborne both left Sunak and Johnson with other legacies. Fiscal rules, debts, deficits and a Treasury that remains powerful and hardly a non-ideological bystander on the economy and public spending. This is one reason why Johnson and his chief adviser Dominic Cummings chose to consolidate power at the centre and to effectively bring No 10 and 11 and the Cabinet Office together as a single political operation. Make no mistake \u2013 this is their budget, with their political priorities and their choices.<\/p>\n And they need to find ways of raising money before they can spend it. Every pre-budget punt floated in the last few weeks has faced pushback, mainly from other parts of the Conservative Party; new mansion or property taxes, increased fuel duty, cuts to entrepreneurs tax relief \u2013 none will pass easily, exposing the great fault lines of Boris\u2019s Conservative coalition \u2013 the traditional, small state, business friendly, low tax, economically liberal party lives on.<\/p>\n Many in it think it was they that really won Brexit and they don\u2019t want the spoils \u2018spaffed up the wall\u2019 on the North (or on anything that has a whiff of a big, interventionist government). And no amount of new colleagues from places like Dudley, Bishop Auckland, Blackpool or Bolton will tell them otherwise.<\/p>\n But as a self styled \u201cBrexitty Hezza\u201d, Johnson wants to appeal to both the traditional as well to newer Tory MPs and voters. He and Cummings want to spend money and on things like trains, bridges, hospitals \u2013 on nurses, police, on skills and on research and development. Doubling R&D funding and setting up ARPA are supposedly red lines for Dominic Cummings. We can expect to see progress and announcements on both.<\/p>\n But to govern is also to deal with the events that the world throws at you. Whatever sunlit uplands Brexit might offer according to Johnson, Gove, Cummings et al, there is a widespread acceptance that there may be at least some short term costs. Splurging on infrastructure will help cushion these effects as well as any economic slowdown resulting from the spread of the Coronavirus. The latter is also too good an opportunity to miss when explaining why doubling R&D spending is a priority and why leading the world in R&D has benefits broader than just economic development.<\/p>\n So this Budget is likely to be constructed along four big themes: new fiscal rules, enabling more day to day spending, the continuing story of Brexit, its negotiations and opportunities, \u201clevelling up\u201d economic conditions across the country and fighting the Coronavirus.<\/p>\n Last Thursday 5 March Sunak tweeted, \u201cWe promised to level up opportunity across the Country. In 6 days time our first budget will start to do just that.\u201d On Sunday, between a packed round of media and broadsheet interviews, he also tweeted to say \u201cit\u2019s 3 days until the Budget that invests in the scientific achievements of the future\u201d. Surely that will include a promise to further boost health research and the development of new vaccines.<\/p>\n There will inevitably be policy detail to scrutinise. He has already promised to review the Treasury Green Book which sets the formulae for government investment. It would be a major surprise if the Dominic Cummings plan for a British ARPA isn\u2019t covered \u2013 perhaps also some significant funding for applied research and more institutions in the style of the AMRC. According to The Sunday Telegraph, Sunak also wants to continue Javid\u2019s exploration of what is counted as long term investment. Like Javid, Sunak also talks of the importance of \u201chuman capital\u201d, or investing in the training of current and future workers as a way of achieving growth. He is \u201clooking with interest\u201d at work by the ONS which could see current spending on areas such as education and health reclassified as \u201cinvestment\u201d, allowing him much greater flexibility over spending.<\/p>\n One way or another they must find new resources to underwrite the promises they made in the election campaign. Many more ambitions for more spending have been added since. It adds up to the one central choice that Johnson and Sunak must now make. That is to loosen their rules now because they believe that there is a long term political and economic payoff for doing so. Borrowing more to invest in R&D, infrastructure and growth across the whole country is their big strategic choice. Spending now will also keep the economy ticking over when threats are growing by the day.<\/p>\n Delay is not an option. Nor is a world where everyone in the Conservative Party or the country at large, gets everything that they want. That phase of our politics is coming to an end. The Prime Minister and Chancellor must make their choices and make their play. For as Nigel Lawson went on to say \u201cto appear to be unable to choose is to appear to be unable to govern.\u201d<\/p>\n [\/et_pb_text][et_pb_post_nav _builder_version=”3.17.6″ prev_text=”Previous” next_text=”Next” in_same_term=”off” locked=”on” \/][et_pb_comments _builder_version=”3.17.6″ custom_button=”on” button_text_color=”#ffffff” locked=”on” \/][et_pb_text admin_label=”Related posts” _builder_version=”3.17.6″ locked=”on”]<\/p>\n [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][\/et_pb_column][et_pb_column type=”1_3″][et_pb_sidebar admin_label=”Subscribe” _builder_version=”3.17.6″ area=”et_pb_widget_area_3″ locked=”on” \/][et_pb_sidebar _builder_version=”3.17.6″ area=”sidebar-1″ show_border=”off” locked=”on” \/][\/et_pb_column][\/et_pb_section]<\/p>\n","protected":false},"excerpt":{"rendered":" “To govern is to choose\u201d said Nigel Lawson, the former Conservative Chancellor. And this Budget is where the government of Boris Johnson really begins and where he must make choices about his real priorities as Prime Minister<\/p>\n","protected":false},"author":521,"featured_media":3277,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":" [et_pb_section bb_built=\"1\" fullwidth=\"off\" specialty=\"on\" _builder_version=\"3.17.6\"][et_pb_column type=\"2_3\" specialty_columns=\"4\"][et_pb_row_inner admin_label=\"Row\"][et_pb_column_inner type=\"4_4\" saved_specialty_column_type=\"2_3\"][et_pb_post_title _builder_version=\"3.17.6\" featured_placement=\"above\" locked=\"on\" \/][et_pb_text _builder_version=\"3.17.6\"]<\/p> When I\u2019m out and about meeting staff I hear much debate about the why, what, when and how of change in our University. I wanted to share my thoughts on this often contentious topic \u2013 and hear your views too.<\/p> Early in 2020 we will launch our University\u2019s new vision and strategic plan \u2013 Our future. In order to fulfil Our future we need to ensure that we are in a financially sustainable position so that we have the funds to invest in the new staff, facilities and infrastructure which will be needed to bring our plans to life.<\/p> Our Financial Statements<\/a> for 2018\/19, which have been published following approval by the Board of Governors, confirm that more than 95% of our \u00a31.1bn income is spent on our core goals - on our staff and our students - to deliver research, education and social responsibility; with the remainder invested in the long term sustainability of our University. You can find a summary<\/a> of the Financial Statements on StaffNet.<\/p> However, this is a testing time for UK universities, due to the many external factors that have an impact on us - current home tuition fees are falling in real terms, whilst our costs (not just pay but non-pay too) are increasing. There are further and even greater tuition fee funding risks outlined in General Election manifestos as well as a range of Brexit-related risks that could affect our operations. The Office for Students (OfS) demands that we demonstrate both value for money for our students and our financial sustainability (in the sense of being able to invest to deliver our ambitious strategy, rather than survival). There are, of course, also ongoing unresolved national issues around pay and the continuing challenges around funding pensions in the higher education sector.<\/p> Our Financial Statements show an improved operating surplus (3.7% of income compared to \u00a324.7m (2.3%) in 2017\/18), with a rise in income from tuition fees, education contracts and research. As I mentioned earlier, we re-invest the surplus we achieve each year in activity in line with our strategy. Recently our funds have been used to create some new academic and Professional Services posts; to invest in key infrastructure including IT; to invest in some new buildings like our student accommodation at Unsworth Park; to improve the student experience by funding more full-time Residential Life staff and to upgrade a range of buildings and research and teaching spaces and resources. Increasingly it is also invested in environmental sustainability and meeting our ambitious carbon targets. So even when we are making difficult decisions in some parts of the University we continue to invest our surplus.<\/p> Whilst we have reported an operating surplus, our Board of Governors expects us to deliver a much larger surplus than this (at least 5%) if we are to be sustainable in the long-term. Our strategic change programme (including IT Modernisation<\/a>, the Student Experience Programme<\/a>, and the Research Lifecycle Programme<\/a>), alongside our continuous improvement plans, will ensure that we create the financial headroom to invest in people and facilities. The strategic change programme will also enable us to embrace new technologies and new ways of doing things that better support all our staff and students to be the best that they can be.<\/p> Yes, this means that some individual roles will change. New roles (some that we haven\u2019t yet identified) will be created and some roles will no longer be required. I appreciate that this will cause some uncertainty and where that is the case we will do everything we can to support staff, but the alternative is that we never change anything. If we fail to take advantage of advances in technology and develop more joined-up ways of working we will ultimately find ourselves outdated in the eyes of future students, funders and other stakeholders. Staff want to work for a progressive and successful institution, of which they can be proud. This means we cannot stand still.<\/p> When I talk to staff and students I often hear their frustrations about how difficult it be can be to get some straightforward things done, grappling with paper-based, manual and repetitive processes, on outdated systems and infrastructure, all of which serves to increase staff workloads. Everyone wants to do a good job, but regularly feel that our world-class status is earned in spite of our internal systems and processes, not because of them.<\/p> To deliver our new vision and strategic plan we will need to embrace new opportunities and face challenges with courage and determination. That will sometimes mean we have to make tough decisions and no-one is claiming it will be easy or that mistakes will not be made along the way. But where we do have tough choices to make we will commit to implementing changes fairly and with compassion to support the wellbeing of all our colleagues.<\/p> [\/et_pb_text][et_pb_post_nav _builder_version=\"3.17.6\" prev_text=\"Previous\" next_text=\"Next\" in_same_term=\"off\" locked=\"on\" \/][et_pb_comments _builder_version=\"3.17.6\" custom_button=\"on\" button_text_color=\"#ffffff\" locked=\"on\" \/][et_pb_text admin_label=\"Related posts\" _builder_version=\"3.17.6\" locked=\"on\"]<\/p> [related-posts-thumbnails]<\/p> [\/et_pb_text][\/et_pb_column_inner][\/et_pb_row_inner][\/et_pb_column][et_pb_column type=\"1_3\"][et_pb_sidebar admin_label=\"Subscribe\" _builder_version=\"3.17.6\" area=\"et_pb_widget_area_3\" locked=\"on\" \/][et_pb_sidebar _builder_version=\"3.17.6\" area=\"sidebar-1\" show_border=\"off\" locked=\"on\" \/][\/et_pb_column][\/et_pb_section]<\/p>","_et_gb_content_width":"","_exactmetrics_skip_tracking":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-3237","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-faculty-of-humanities"],"_links":{"self":[{"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/posts\/3237","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/users\/521"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/comments?post=3237"}],"version-history":[{"count":7,"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/posts\/3237\/revisions"}],"predecessor-version":[{"id":3279,"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/posts\/3237\/revisions\/3279"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/media\/3277"}],"wp:attachment":[{"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/media?parent=3237"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/categories?post=3237"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.manchester.ac.uk\/viewpoint\/wp-json\/wp\/v2\/tags?post=3237"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Related<\/h1>\n
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Improving our financial performance will help to deliver our ambitious future plans, but we must also increase our capacity to create the funds and time to invest in our core goals. One of the ways we can do this is by changing what we do and how we do things.<\/p>Related<\/h1>