Where are all the ‘Waitrose women’?

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0:44Hello and welcome to Coffeehouse Shots, the Spectator's daily politics podcast. I'm Oscar Edmondson. I'm joined today by Michael Simmons and Noah Hoffman. And the IMF have just published, or this morning published, its World Economic Outlook. and they found that Britain's economy will grow faster this year than previously expected. Now, Michael, this is brilliant news, unless you're about to tell me that it actually isn't. Well, it is good news. You're right. The first bit of it is, anyway, that they've upgraded growth for this year, a little downgrade for next year, but they've upgraded it for this year.

1:14And the reasons for that are that they say that what's gone on in the Strait of Hormuz and the latest action we've seen from the Hufi branch of Just Stop Oil has actually not had as bad an effect on the UK economy, but also the world economy as had previously been predicted. They also said that spending on AI and AI hardware companies has kind of propped up the global economy. So actually, in terms of the hit to growth, it's not been that bad. And they say that alongside Germany, we're going to be the second fastest growing economy in the G7 after America. The real pat on the back, though, from the IMF for John Healy came where what they said about deficit reduction.

1:58They said that Britain was one of the only major economies that was going to be bringing borrowing down. They think borrowing is going to come down by four percentage points of GDP over the next five years. And they said that we were actually going to reduce our deficit, unlike many other countries in the world, which they said needed to get on top of them urgently. But this is where the good news stops, because that analysis from the IMF is based on what I would say is a complete myth. And that complete myth is the kind of spending and tax envelope that Rachel Reeves left at the end of her last budget.

2:34And because when we do a budget, you kind of always forecast out your plans for the next five years. If you're to believe those plans, it says, you know, yes, the deficit will be gotten rid of. borrowing will come down and that will be done through spending cuts that are apparently going to happen in the start of the next decade and also tax rises that are going to take effect at the start of the next decade or towards the end of this one there's a kind of major problem with that which is what else is happening towards the end of this decade unless it happens sooner a general election. So for the IMF's analysis to be correct, to say actually Britain and John Healey and Rich Reeves or whoever are getting this under control, it requires the Labour government and whoever the Chancellor is at the time to be controlling public spending and hiking taxes just as they're around either going into an election or just coming out of one.

3:32Does anyone think that's realistic? Well, on your public spending point, it hasn't been a great week for John Healey overall because there was also the news that he's got£35 billion worth of cuts that he needs to find in the budget in order to meet these public spending pledges. That was reported by some think tank, which I've now forgotten the name of. So, Michael, any idea of where he's going to find that amount of money from as we look towards the budget at the end of the month? I mean, he's not going to find that amount of money. And in fairness, there's some assumptions underlying that£35 billion that doesn't apply to this budget here.

4:06I still think the way to read this budget is this is going to be the stand-up, sit-down budget. Their headroom will have been reduced, but it won't have been reduced to zero. So they don't necessarily need to top it back up again all the way to the top. Their back benches are clamouring for some kind of energy support. So I think, you know, it'll be stand-up, some kind of commitment to get the poorest households through the winter. But he's not about to announce massive spending restraints. And also there's an acknowledgement that they've already put up taxes in this parliament by something like£70 billion.

4:40They're not going to do a major squeeze on tax. So you're not going to get that£35 billion hole filled in this budget. The problem is, if that analysis is right, is this can has been kicked down a year down the road into really, really rough grass. And I think the budget to get excited or terrified about is going to be the one in 2027. Because every time you put off those major decisions about how you actually get the books balanced again, which no one has talked seriously about, it gets harder and harder and harder. So don't expect these problems to be fixed at this budget. Let's see what happens in a year's time.

5:18So that's what to look forward to sort of on the economic side of the budget. But what about on the political side, Noah? What are we hearing about the infighting, the splits that inevitably come from a budget?

5:29Noa Hoffman: So look, at the moment, Labour MPs are expecting more or less what Michael has laid out. this isn't going to be a budget of sort of radical rewiring of the economy in a far more left-wing position and the reason that Burnham will get away with that at least for this year is because at Labour Party conference he used his speech to show Labour MPs where the promised land lies and what is within it and that really buoyed them and they're willing to give some sort of breathing space and time. And there's also an acknowledgement among Labour MPs that in order to, you know, have these big changes, possibly to income tax, all these wealth taxes, and we may see some tweaks to various taxes at this budget as well.

6:16Noa Hoffman: But the big ones in order to sort of rewire the economy as they would see it would have to come after a general election. And Burnham would need a mandate to do that. And they're confident that he would get that mandate. Now, Whether the public agrees with that is an entirely different question and we'll get into the new polling out today from YouGov shortly. I think where Burnham could run into hot water with his MPs will be in November when we're expecting the Melbourne review or after the budget. And if Melbourne comes down quite hard in the way that we're expecting on particularly young people and changes to mental health and benefits around health and disability, that's where there's scope for potential infighting within Labour.

7:05Noa Hoffman: But in terms of this budget, I think they're more or less on board that it's not going to be, you know, the most exciting socialist treat that they've all been hoping for. And it's worth keeping an eye in terms of potential budget fighting on Number 10's relationship with the Bank of England as well, because we've already had reports of an annoyance in Number 10 at some comments that the bank's governor, Andrew Bailey, made last week. And he basically was saying that the government had to be careful about public spending if it didn't want to set off another Liz Truss-style bond or guilt disaster.

7:39Now, what's he actually talking about there? He's talking about Liz Truss's energy bailout. And when we talk about, you know, the Liz Truss debacle, most people think that the guilt yields went crazy because of that mini budget. And whilst it certainly didn't help, it's worth remembering that one thing that they were really unhappy about was the unfunded nature of her energy bailout, which in theory could have literally could have cost unlimited amounts of money that all had to be paid for by borrowing. So that was a not so subtle warning from Andrew Bailey that's kind of been repeated by the IMF today, that if you are going to do some sort of winter cost of living support, you cannot do it in the maybe blanket way that Labour backbenchers would want.

8:22And I think Andy Burnham recognises that. Noah, you mentioned that polling. There's a YouGov poll out today, which I'm looking at now. Very interesting reading because it puts reform in third place behind Labour first and the Conservative second. How should we be interpreting this?

8:36Noa Hoffman: Yes. So obviously, the big disclaimer is that this is one poll and it doesn't yet indicate any sort of entrenched trend. But a few things that really stand out. Firstly, when it comes to reform, they are not winning back the votes they have lost in the wake of funding scandals. They are very solid at this sort of 20 percent mark. But really, at the moment, they're just preaching to the faithful and they're not able to bring back any of those who were potentially flirting with Farage, but have been very put off by the numerous unforced errors the party has made. This isn't a media conspiracy against reform at all.

9:19Noa Hoffman: This is the reality of what their strategy is producing at the moment. And really, they're just they're speaking to themselves and they're speaking to their own supporters. Now, when it comes to the Conservatives, you'll see on social media a lot of happy Tory MPs today. This is, you know, one of their much better results. And it shows that the Tory party conference did have an impact on the public, which, you know, a lot of people would be forgiven for thinking nobody perhaps would have cared. But clearly, Kemi is resonating. Now we saw just ahead of Tory party conference, this strategy from the party, forget the Workington man, we're going for the waitrose woman.

9:59Noa Hoffman: Who is the waitrose woman? Well, I would probably be one of them, you know, sort of white collar workers who are aspirational. They want to work hard. They want to pay less tax. They're quite focused on the economy. They live in the cities and they're a bit put off by more left leaning Burnham economic plans and they want to be rewarded for the hard work they do and sort of be able to afford a family, afford a nice holiday. The questioning around that strategy when it was first revealed was just how big is this demographic? A lot of people seem to think, look, it's quite specific and perhaps it is an untapped demographic when it comes to the other parties.

10:39Noa Hoffman: But is that really going to be enough to win you an election? And it's clearly not. But look, Look, maybe she's starting to turn the tide there, but we cannot make any solid judgment until we see a few more polls after this and we wait a bit longer. Labour, very interesting on 24%, shows that the post-conference burn and bounce was not as strong as some may have suspected. And I think, look, in the wake of his speech, it was compelling. I'm not talking about whether you agree with the policies or not, but as a speaker, as a speech, he's compelling. So that gave him a bounce. But then you get to settle in with the policies and really think about them.

11:24Noa Hoffman: For instance, getting rid of first past the post in favor of proportional representation. Who is that going to benefit? It's going to benefit the likes of Rupert Lowe and the Restore Party. It's going to benefit the Greens. It's going to benefit the fringe on the extreme. It's going to lead to more coalitions. Things just tend to get done a lot slower when you have to wrangle with loads of other parties in a coalition government. Is that really what we want? Brexit. Look, there's a lot of Remainers out there and people who are really upset with the Brexit referendum vote, who at the same time think of all the crises facing the country right now.

11:58Noa Hoffman: Do we really have the bandwidth? I think reality setting in is what we're seeing in this YouGov poll. Michael, just a final question. I did wonder what you make of this polling because it comes immediately before a budget. Is it demonstrative of the fact that, you know, people do trust the Tories a bit more on the economy? They've made that a big part of their package, potentially more so than Andy Burnham has. Do you think they're seeing the benefit from that? Yeah, look, I mean, there's clearly a bit of a chemie conference bounce, as Noah was saying there. But you do see that when you look at issues polling, that Tories are consistently seen as the party to trust on the economy, whatever happened in their 14, 15 years.

12:41And I think there is some benefit to them to be really going hard about wanting to be the kind of low tax, low regulation party. And to play into that, I would suggest that they don't just think about the waitrose women.

12:57Noa Hoffman: they should think about the aldi autist what on earth is that the aldi autist is the aldi autist is like the gym bro young professional who he doesn't need the fancy waitress stuff he's just bought by buying like chicken steak protein yeah because he's like he's luke's max the huell humbre yeah yeah yeah he's doing all that stuff but but michael what makes them autistic well they're very scientific right it's not just that they're they're bulk buying that that chicken and steak and pasta and brown rice they're measuring it out they are tracking their macros in an app these are these are scientists who want an affordable cost of living to you know really max their lives more than like more than probably the waitrose women this is a guy that's getting absolutely hammered by taxation.

13:50He's likely to move up in his career and fall foul of the 100k cliff edge. So if, I'm very much not, but if I was advising the Tories, I would say, don't just go for Waitrose Woman, go for Aldi Autist. Perfect. Heard it here first. Heard it here first. Well, thank you, Waitrose Woman, Noah Hoffman. Thank you, Aldi Autist, Michael Simmons. And thank you for listening.

14:21Hi, this is Nikaela Matthews Okome from SideHustle Pro. The sale's right there. Don't miss it. This holiday, give shoppers a flexible way to pay with PayPal Pay Later and turn them into regulars. PayPal is built for all business. Get started at paypal.com slash business.