'A tax on success': Reeves's nightmare Budget unravels

0:02The Telegraph.

0:09We've had the budget, now we've crunched the numbers. How much money have you lost in Rachel Reeves' tax raid? We're going to be speaking to former Treasury advisor Cameron Brown, who worked for both Kwasi Kwarteng and Jeremy Hunt, and we're going to discuss whether Kemi Badeknot was too mean to the Chancellor in the House of Commons yesterday. Welcome to The Daily Tea with me, Tim Stanley. And me, Kamina Tomini.

0:43Tim, it wasn't just the budget yesterday that's proved divisive. Some people have commented on the tank top that you chose to wear, which to be fair... There have been questions in the house. You say chose to wear, like it was a controversial... Like I was trying to say something. Let me put it like this. You did pair it with a tweed suit and a mink hat. It was sort of... That's a perfect combination for a cold day. I quote Queen Anne, Princess Anne. There is no such thing as bad weather, just the wrong place. It was slightly sort of Alan Bennett meets Leonard Brezhnev. Really? Well, I liked it.

1:16Didn't I compliment you as soon as you arrived when I saw that tank top? But apparently the listeners and the viewers are in two minds about whether you should be wearing a tank top and certainly whether you should be wearing one too. Extremely serious budget podcast. I've only had positive texts and a very good response in the mirror. I mean a mirror, not the mirror. Yes. So I'm happy about it. The tank top is Shetland wool. Oh, cosy. The suit is by Walker Slater because, as you know, I am spiritually Scottish. Well, indeed. This is how I dress in the highlands. Channeling you're in a Ben Fogle as well there.

1:49Wonderful. Cameron Brown joins us in the studio. Lovely to see you, Cameron. You are a former special advisor to HM Treasury, now a senior advisor at Charles B Strategy, which is a kind of PR and public affairs company. But you did work under Kwasi Kwarteng and... Jeremy Hunt. Jeremy Hunt. Indeed. And if you reflect on yesterday and you reflect on the mini budget, I do have to ask you, which do you think was worse? I think, my Lord, the lead-up to yesterday's budget was chronic and corrosive over many, many months of quite painful speculation about wealth taxes and exit taxes and income tax rises and phantom tax rises that weren't actually in it.

2:31culminated in this wonderful, almost Greek tragedy moment of the OBR actually leaking the budget half an hour in advance. So I think the run-up to it was utterly chaotic. As for the actual kind of impact on the economy, I have to say the Kuateng budget slightly pips her to the post in terms of the adverse market reaction. Although there's still time. The markets could go into meltdown at some future moment with yields going up and the rest of it. They seem to be happy at the moment because she has obviously raised taxes. She has doubled her headroom for the future. And that's the sort of thing markets look for because what they want is confidence that government can pay its debts.

3:12But that's not actually necessarily the right thing for the economy in the long run, right? What Liz Truss and Kwasi Kwarteng tried to do was a little bit different. They were willing to borrow to cut taxes. But the point was they were thinking in the long run about growth. whereas this is a very short-term, just fix something kind of budget, but it has no long-term vision for how you grow an economy. Completely. And the OBR make that very clear in the documents that there's next to no material benefit to growth whatsoever. And Labour have made a very clear kind of commitment that growth is a priority.

3:48They have these kind of missions and the growth mission is repeated by ministers on the airwaves on a near daily basis. but there was next to nothing in the budget whatsoever that you could say will drive economic growth. I'd actually say a lot of the measures put in are going to spook markets and deter investment. And as we saw with the statistics today, people are now leaving the UK. There's a mass outflow of working age British people now leaving the UK. It's because of the chicanery of the average politician that you forget that these commitments have been made because we need to have a conversation about whether she does have to resign because of the breach of the manifesto.

4:25And funnily enough, this is something that the IFS's Helen Miller spoke to this morning. They always give their budget reaction the day after and pick through all the different numbers. And she touched upon whether promises had been broken when she spoke about the move to cap tax breaks on salary sacrifice pensions contributions. Some will also be interested to note that as a result of both this measure and the new threshold freezes, national insurance will increase. I would call that a breach of the manifesto. We then see Rachel Reeves on the airwaves this morning doing the broadcast round. She's repeatedly asked by various different journalists, including the BBC's Nick Robinson, are you going to apologise?

5:02You've breached the manifesto. And she says no. So far you haven't apologised for the fact that you repeatedly promised to do something and you've done the opposite. Would you like to take the opportunity to now apologise? Well, I believe that they were the fairer and the necessary choices. That's not the question. The question is, could you have known that you would have to put up taxes? Every day on this programme in the general election, the Institute of Fiscal Studies said these numbers don't add up. The Resolution Foundation said these numbers don't add up. Every economy interview said the numbers didn't add up.

5:34You insisted they did. You insisted that working people would not have to pay more tax. They now are. Why won't you apologise? Nick, I have to operate within the forecasts that I'm presented with. Of course, I could have made different decisions, but I believe those are the right decisions so that we can reduce NHS waiting lists. And so that yesterday I was able to announce a package of measures to lift kids out of poverty and also to get the cost of living down for families. So I believe that they are the fair and the necessary choices. and I stand by them. So we have that, I think, outright lie.

6:16She's claiming she hasn't breached a manifesto that pledged not to put taxes on working people. And we now have a£26 billion tax bill, problem number one. But problem number two, Cameron, as you have said, and let's be honest, they put the house on this. I mean, they put Ed Miliband's house on it, which is now subject to a mansion tax. They put the house on growth and said they would grow the economy. That was the whole gamble. That was the big picture offer to the public. And 1.5%, as you said in your sketch, Tim, it was like finding a tic-tac. At the bottom of a stocking. Yes. And also at the beginning, she devoted about two hours to listing her capital spending projects.

6:56And the problem is I've heard those before. She was repeating things. As soon as I heard the magic words, Peterborough Sports Centre. And look, there will be an MP that will be cock-a-hoop that they've got a new sports centre. Probably the MP for Peterborough, to be fair, yeah. Yeah, but that isn't an industrial strategy. Spending money on municipal projects is, again, not something that drives growth. A bypass in Croydon or something. We need bridges and other things. Like Boris Johnson used to go on about massive infrastructure projects. Mind you, look at HS2. You've got to be careful what you wish for, haven't you?

7:30But this whole resignation issue, I mean, clearly she isn't going to be a turkey voting for Christmas, right? No. She's not going to fire herself necessarily unless things get really, really dire in the coming days and weeks. But she's the one who's going to have to fall on her sword. It's not as if politically, Cameron, the prime minister can fire her, because as you experienced when you were working for Kwarteng, you know, you fire your chancellor and you basically fire yourself. Oh, completely. I mean, you're having a chance of the exchequer is one of the best Kevlar body armour suits you can ever have as a prime minister.

8:02And the minute you fire your chancellor, all the barrels of guns are pointed towards you. But I think what Rachel did, which was quite smart for herself politically, is she's banking the winnings now. She's investing heavily. She's spending heavily, certainly over the next three years. But all those quite kind of annoying and quite corrosive tax rises, they're not coming until 2028, 29, 30 and even into the next parliament. So there is a possibility that, you know, if she is removed as chancellor, it's the incoming Labour, new Labour chancellor that has to pick up all the pieces later down in the parliament.

8:40So if that was a deliberate consideration for her, I think she's done a very good job. I wonder if the new chancellor, once it happened, will go back and blame Rachel Reeves for digging a 22, let's call it a 26 billion black hole. Yeah. But remember in our interview with Clive Lewis, I think the most interesting point he made was that she and the prime minister are tied together. Yes, he said they were a double act like you and me. But no, that's right. They rise and fall together and that's just the way it is. Yes, yes. And wasn't it interesting as well that we've written a piece for the website saying this wasn't actually Reeves' budget, it was Angela Rayner's.

9:15The former Deputy Prime Minister, who we know is to the left of Rachel Reeves, had written a memo where she had made some of the suggestions around, for instance, mansion taxes and freezing of thresholds and all the rest of it. And it's interesting, the dynamic of that, because we know that Rachel Heves and Angela Rayner don't see eye to eye because there were rumours unsubstantiated that at the time the Chancellor appeared in the House of Commons crying, just before then, she is alleged to have had a stand -up row with her former cabinet colleague, I should say, now that Angela Rayner is somewhere in Hove on a paddleboard.

9:48But this leaning into the left, you know, Alistair Heath, regular on the Daily Tea, the Sunday Telegraph editor and columnist, has said, you know, this is a return to socialism. And we did put that to Clive Lewis yesterday. He said, well, we've got to completely distance ourselves from Thatcherism. That speaks to me as, OK, then we do need to return to the 1970s. That's what he's advocating. Yes, Blair, I bumped into, said to me, I did not like this because this was a budget aimed at the party, not at the country. Yes. Which is the antithesis of Blair. And I think part of the problem for our generation is we're a bit too young to remember, I'm far too young to remember, governments in the 60s and 70s.

10:26So to us, the Labour Party is Tony Blair. And he was unusually quite good, both as a communicator and also his economics were not totally whack. So this government doesn't really bear comparison to him. This is much more like governments of the 60s and 70s, which are all about this doom spiral of taxing and spending that ruins the economy. So you have to tax and spend a bit more, and then that ruins the economy. So you just end up doing the same thing over and over again until the Tory government comes in. Yes, everyone's had enough because they haven't got any money left. There's no money left.

10:59But what I would like to ask Cameron is, when you were working for Quarteng and for Hunt, how conscious were you of the growing welfare bill? I think we were. It became more apparent as the months and years went by. I know in the OBR stats yesterday, we're going to be spending about 400 billion pounds on welfare by the end of the decade. That is clearly massively unsustainable. I mean, post-COVID, we had a massive increase in long-term sickness and those economically inactive, those that are effectively withdrawn from the labour market. And the only real way to get to grips with that is really serious welfare reform.

11:38and it's going to require a number of years from a party with a pretty decent majority to actually do that. The problem for the Labour Party is they tried to make even the smallest of haircuts to the welfare budget, about£5 billion this year. Very, very modest in the grand scheme of things. And Labour MP said no. It's extraordinary that it was so minimal. Your former boss, Jeremy Hunt, wrote a book, spoke to us about it on the podcast, doubled down on it in a Sunday Telegraph column, you know, basically saying, go back to pre-pandemic levels and you'll save 50 billion. The bigger this welfare bill becomes, Tim, the harder it is going to be to cut at all.

12:14And then again, to just channel Lewis, Clive Lewis said to us yesterday, well, benefits aren't very generous in this country. I thought, what? So there are some lefties that think that people who receive benefits still aren't getting enough, even though I cited the example of the single mother who admitted to Fraser Nelson that she was on 36 grand in benefits and she could not afford to get a job that paid her more. And I had huge sympathy with her. But Clive Lewis said that some of his constituents are eating sand. Yes, he did. We should have picked him up on that. I didn't want to in case I either misheard him or it was true, in which case I would sound awful for saying is that true.

12:55But how about this? How about this for a statistic? The CSJ, the Centre for Social Justice today, sends out a press release saying that rough sleeping has increased by more than 90%. There are now nearly 10 ,000 people who are homeless. Well, hang on a minute. I thought that, first of all, homelessness was just the Tories' fault. I thought that there would be no poverty under Labour, as they've promised it. And we have kept on hearing this figure about how these measures in the budget are going to pull 450 ,000 children out of poverty. I'm not quite sure where you get that figure from. Is it from the Joseph Rowntree?

13:28Is it plucked out of the sky? How do you quantify it? The counterpoint to that is you've put the minimum wage up. But if youth unemployment continues to go up, OK, they may not be children in poverty, but it's a generation in poverty if they can't actually get jobs. So this whole kind of idea that Labour are going to constantly cure society's ills, Cameron, by just pumping more and more of workers money. Let's be very specific about it, because the benefit bill is going up on the back of working people. It's tricky. And a smaller pool of working people as well. So the tax burden is increasing and we're taking more from an even smaller pool of productive workers.

14:09I mentioned people leaving the UK, of course, but more and more people are going to be dragged into tax or indeed dragged into paying income tax for the first time, including those on the state pension. Those on£12 ,000,£13 ,000 will be starting to pay income tax for the first time, which I think is just abhorrent as a principle. That is abhorrent, isn't it? But as we've seen, state spending has increased enormously over the past decade. Borrowing has increased enormously. Taxes increased enormously. But all of those metrics, when you look at relative poverty or homelessness, haven't actually improved.

14:41And interest waiting lists have continued to increase. So something is going horribly wrong with the way that we allocate state resources. And it's not so much the case of let's just give more money to welfare or give more money to the National Health Service or more money for public services. because it's not being used effectively. It'll take a very brave government, and I don't believe Labour have the political bandwidth to actually get away with this, to radically reform how we allocate resources and what we expect from public services. Well, isn't it because the left-wing view is that, you know, the more you give businesses, they'll be given an inch and take a mile and consequently abuse the workforce.

15:16There's always this assumption with the left, landlord, bad, going to be awful to the tenants, going to arbitrarily put the rent up. Some of them are like that, of course. there are some very badly run businesses run by awful people. They definitely don't like landlords. They don't like landlords. Rachel Reeves really sounded as though she'd grown up in Dickens' England, the way she talked about landlords. But also she was saying that about her school and it was just absolutely ridiculous because she's a child of Thatcher who socially mobilised herself all the way to Oxford. Did she have to pay rent for that port-a-cabin?

15:45Is that the route of this? Well, as you said, if we can educate children in port-a-cabins that end up being chancellors, why build any new schools at all? Yes. But my daughter sent me this. This is her kind of like rough mathematics because we were talking about the minimum wage and she was earning, I hope she doesn't mind, but she was earning£10 an hour at the pub and then we were saying, well, will it go up to£10.85? And then she said, oh, I've done the maths on this and I think I've worked out that the extra 85p added to the minimum wage only comes to an extra£153 a month for workers, even if they work a 45-hour week.

16:20That's literally useless. However, it would cost businesses£765 a month if they have five young workers. That is substantial. Young people aren't fueling that£150 back into the economy. Thank you, future Chancellor. But that's the point, isn't it? You know, this constant suspicion around the wealth creators and that they aren't somehow going to pass it down. And of course, again, Lewis is using the example of dreadful water companies that are filling our rivers with sewage and taking massive bonuses. I think actually we can all be socialists when it comes to our appraisal of water companies. OK, but in general, Cameron, I mean, if you were a business yesterday listening to what was announced or indeed a sole trader or a freelancer or self-employed and noticing that your dividend tax has gone up and up.

17:08I mean, you wouldn't really feel encouraged. You won't be encouraged to employ more people or grow the business at all, as far as I could tell. Yeah. And I've spoken to a number of businesses over the past 24 hours. And the sentiment is exactly that. There was nothing in the budget that is remotely helpful for them. Indeed, a lot of the measures are actually pretty negative towards them, whether it's the previous national insurance increase, which makes it considerably harder and more expensive to hire people. And it's typically young people that are going to feel the impact of that because coupled with the national living wage increase, we're getting to this kind of wage compression scenario where it becomes almost like a maximum living wage in the country where lots of people are on 24, 25 grand.

17:51And that is about the ceiling that they'll ever reach. But for business, there's next to no incentive to hire because of the additional costs, including salary sacrifice changes with national insurance and living wage, the previous employer, national insurance. It's just prohibitively expensive. And it's young people that will be adversely impacted. Budgets are partly about sending signals. And the single signal that a lot of people will take is this government doesn't actually want you to make money. It doesn't want you to let things out. It doesn't want you to build a business. It doesn't want you to move into a bigger house because it will then tax you for it.

18:27And the implication is that the mansion tax is almost like a vice tax. It's like a tax on sugar. You're being taxed because you're in a big house. You're being taxed for your success, basically. Yeah. And that makes you fair game. Well, it's the same as the VAT hike. They don't really like that. The best analysis that I've heard was on the BBC this morning by an economics professor at Cambridge who said that we're trapped between the skiller and cryptus of a big state and poor growth. So the state, as you say, Cameron, has grown enormously. and also the tax take has grown enormously. And really in the last five or 10 years, not really in reaction to anything that's, any big socioeconomic thing that's gone on.

19:01It's in reaction to events, Dubois events. It's things like COVID and Ukraine and the ratcheting up of people's expectations of what the government should do. So more welfare spending, motability, cars, PIP, et cetera. So that has grown and grown. And really all Labour is choosing to do is to feed the beast, look like you're balancing the budget, generate the headroom, calm down the market. But the problem is, is that at the same time, actually people are quite poor. Yes. In the sense that they're not getting on in the way that under capitalism they should be getting on. Well, even people on quite high wages aren't feeling.

19:34Right. They're not feeling they can spend extra on nights out and stuff. So if one crashing rock is the growing state which is going to suppress business because the state is just taking up so much money and spending itself in quite a useless way. The other rock against which we crash is the poor productivity. Yes. that we are not working hard enough, there's not enough ingenuity, there's not enough creation in the economy to generate the money that means that people can switch instead from that into the private market. And the problem is this government is now so focused on balancing the budget.

20:06This is where I don't class this as a socialist government. It is a public sector government. Yes. It is the government of bureaucrats and experts and officials. It's the ultimate triumph of the expert class. It's high-vis and lanyard class government. And all they're interested in is today have the markets responded well to our measures. What they're not doing is anything growth-wise, whether it would be some big sort of Stalinist project to damn the Thames, or be it a trussite project to liberate us all so we go and create the capital ourselves. There is no spur to productivity in this. So one can just see the state continuing to grow as it's currently set to do.

20:44Do you believe that, Rachel Reeves, even if all this worked, even if tax revenues went up and suddenly there was an explosion of productivity, do you believe she would reward us by cutting taxes? No. No. No. No. It's not in their DNA to cut taxes. No, precisely. And it's not so much, well, isn't she awful, increasing taxes constantly. I think it's just a legitimate left-wing view that the state needs to be adequately resourced and we need to fund good public services and people should all make their contribution. That's kind of the key word over the past 24 hours, make the little contribution.

21:17It's fundamentally what they believe. And I don't believe if we do get the proceeds of growth in the future, that the first thing she'll do is reduce taxes. She'll prioritise investment elsewhere or lift them. Also, if you're going to attribute a very negative word, austerity, to any government savings at all, if you're going to say that cutting spending in different departments is austerity rather than efficiency, then you can never justify it to anyone. Well, tax rises are austerity, right? Yes, of course. For those having to pay them. Completely. And the outcome is the same. People have less money.

21:55The government has less money. It's exactly the same. Cameron, what's it like inside the Treasury on Budget Day? It's insane because you are trying to announce your budget that's probably already half leaked anyway. Certainly from my experience doing five of them, pretty much all of them are public anyway, either through speculation or leaks or just wonderful guesswork and deduction. And then you go to the Commons, you're sat refreshing Bloomberg to see how the markets react. Refreshing the Telegraph website. Refreshing the Telegraph website. Thank you. Tuning into the Deadly Tea podcast. Thank you.

22:28And you're kind of waiting with bated breath for the first front pages to drop. And you're waiting for Alistair Heath's top analysis. Are you? Thank you. Indeed we are. I bet. You're hoping the word pasty or omni-shambles doesn't appear anywhere near you. In all of his colourful glory. And then you've got to wait for day two, the day we're in right now, when everybody unpicks. And the IFS and the Resolution Foundation, which are basically extensions of the Treasury, are all just commenting on each other's work and slowly unpick the budget piece by piece. I would have thought day five is actually the most dangerous because that's when the Sunday papers come out.

23:00and they've really gone into the weeds of it all because they don't need to do anything live. Liz Truss, nemesis of the OBR, wants to get rid of it altogether, has said that the early release of the forecast should serve as, quote, the final nail in the coffin for the organisation. Do you agree? I think he probably ought to resign. I mean, it's... The head of the OBR. Yeah, I mean, it's catastrophic. I mean, there's nothing worse than leaking or accidentally publishing what is exceptionally market-sensitive information before the Chancellor has stood up in the House of Commons and read it out.

23:34I mean, it's a complete catastrophe. It's never happened before. So fundamentally, he must take his fair share of the blame. And I think it's the honourable thing for him to do is resign rather than saying, you know, if the Treasury Committee want me to leave or the Chancellor wants me to leave, I will. I think you need to take some responsibility. I mean, you have one job and that safeguarding market sense of information and they failed at it. Yeah. I have a theory which is that there is one reform voter on the civil service, probably called Pam who just hates them and anything she can get her hands on she just emails it to someone We need to get in touch with Pam I bear top swords It's all coming from one disgruntled reform voter Love it Who's like secretly wearing turquoise socks and has got a tattoo of Nigel Farage somewhere upon her person Before we move on Cameron because we've got lots of people who wanted to ask you a question and we just want to sort of talk to you through some of the elements of the budget and how they've affected our audience.

24:31Can we just have a quick chat about Kimmy Baden-Ock yesterday? I mean, I was out at dinner last night. I don't mind telling you. Sat with Christopher Biggins. Such a good night. Of all the people you could say with such pride. I know. I don't mind telling you last night that I sat next to Donald Trump or Plato. But no, Christopher Biggins. Christopher Biggins. And there was an element of panto to yesterday. In fact, he agreed with me that there was a degree of sort of showmanship being orchestrated by Kevi Badenock, who we both agreed yesterday played a bit of a blinder. She's there, Cameron, telling jokes about, you know, Rachel Reeves.

25:06My favourite one was that Rachel Reeves was the Christmas guest who came in unwanted and then ate all of the quality street within 10 minutes of arriving. And all this stuff. And we said at the time it was really quite mean girls-ish, wasn't it? It was she'd taken the gloves off and really gone for the Chancellor. And we were a bit disappointed because the feed we were watching, We didn't pan enough to Rachel Reeves' crestfallen face, but apparently she looked pretty destroyed by the whole thing. Now, a number of commentators are saying she went too far. I think she may have crossed a line. Oh, Tim.

25:39I do, I do. Your tank top has gone to your head. It's gone mad. It was so personal. There is a convention that it's OK on budget day to go a little bit further. That is true. And the other thing is the last time I can recall such a personal attack in the Commons, it was actually Starmer against Boris. And this is the thing with Labour. What they accuse others of, they've usually created the press as a four. So in all of that sense, it was fair game. And watching the six o 'clock news, Kemi's performance stood out and eclipsed the Chancellor. And I'm not going to deny it was fun to watch, but there was a part of me that was thinking no one is ever going to run for Parliament if they saw that.

26:19Some people, sociopaths will look at that and think, that looks fun, I'd like to do that. But ordinary people are going to look at that and think, is that what happens when you try and run an economy? Someone talks to you like that. This is ridiculous. I'm sorry, right? OK, she accused her of wallowing in self-pity. She said that thing about woman to woman. It's not because you're female that people have been critical. It's because you're useless. Also, I love how this whole idea of Rachel from Accounts has been turned on its head as if it was a sexist remark. The reason she was called Rachel from Accounts was a joke about the fact that she'd made up her career history and she wasn't a senior in the Bank of England and other places of employment.

26:56She was Rachel from Complaints. So if it had been Ricky, if somebody called Ricky had been Chancellor, made out that there were some top economists but actually were doing the paper copying, he'd be called Ricky from Accounts. From Accounts is one of those phrases. I genuinely think that Rachel Rees will never again utter the words I am the first female Chancellor because once another woman has laughed at you for doing that, You can't do it again. But hang on a minute. So I give Kemi that. She's broken the spell of this is all about equality. You're saying this is un-sisterly. I was walking through the comments.

27:29No, nothing's un-sisterly. I thought it was unpleasant. I don't mind un-sisterly behaviour. There were moments in which I thought, oh, this is a new low. But hang on a minute. This is a woman who... I hope Kemi doesn't listen to this because I'm going to brick through my window. But she does listen to this, by the way. And she takes notes. She's already contacted me to comment on your tank top, who obviously wants to borrow it, if you can lend it. But Cameron, I'm sorry, let's just be perfectly frank about this. When it comes to vicious vitriol, it's left to right always. Kemi Badenock is a woman who's been called a coconut, an Uncle Tom.

28:02She's had to face the worst of the left slurs, frankly, because, oh, lo and behold, she's a black woman on the right. She's been a victim. And by the way, we've discussed this. The Prime Minister so talks down to her and denigrates her at PMQs. and now they're all complaining. Poor old Chancellor, come on. This is politics. It's rough and tumble. Keir Starmer mansplains all the time. Yes. But it feels like you're being splained to by a plank of wood. There's something so characterless about the way he does it that you might not notice it. But actually, I think he is pretty patronising. Do you think Keir Starmer would wear that tank top?

28:42Sorry, it's the last mention of that. Let the tank top go. That's a vision. Cameron, what do you think? Was it too much? can we go too far? I think she had a lot of material to go on, right? There was no shortage of different attack lines. And I think she played it brilliantly well, right? And I thought it was one of her best performances in the Commons. But in politics, it's part and parcel of the game, right? It's going to get a bit personal at times. And it's usually always in kind of lighthearted jest with all these things. But you've got to have a thick skin in this game on both sides. And they give it just as good as well.

29:14Lighthearted jest. Spineless, shameless, completely aimless. Someone who will not have enjoyed it is Rob Jenrick. No. Or I tell you who would have enjoyed it even less, Mrs Jenrick. Why can't you perform like this, Robert? Yeah, because Kemi is now performing at the level of or even better than Rob Jenrick. And once the leader of the opposition starts behaving that way, you no longer lead to report on the shadow justice minister behaving that way. So I feel Kemi is in a much stronger position right now. Why would I need to swap her out for Rob Jenrick when she's talking like Rob Jenrick? Coming up next, Cameron is going to answer your questions.

30:10A few reactions from our fans here. Reader Dylan Ratcliffe asks, do we think Reeves is making such decisions because she wants to or because she's been hustled into it by her backbenchers? The latter, I would suggest, Dylan, yeah. Rachel will ask her backbenchers what to say about that. Simon Booth says, what does the somewhat positive reaction in the markets mean? I think it's quite straightforward. They know she's going to increase taxes. You know, that is credible for them. It's like, well, I know you've backloaded all of those tax increases. to 2028, but you're a Labour Chancellor and you've actually demonstrated you've already increased them by£60 billion.

30:49So we have no reason to believe you won't in the future. So from their perspective, she will raise tax and bondholders will get their money back. Well, that whole thing about the markets wanting certainty, they knew what was in the budget for six weeks, more or less. I mean, OK, to be fair, I suppose the last week has been the most informative and instructive because we found out she'd abandoned a pledge. No one knew that the duty on bingo would be scrapped. True. That's the rabbit. That is the rabbit. That was the rabbit pulled out of the hat. OK. Again, I bet Pam planes bingo and I'm sure she'll be very happy about that.

31:23So we know, Cameron, that the tax rate is going to hit savers, middle earners, students, homeowners, pensioners, electric car drivers and people who like milkshake. But who do you think, which group of people do you think comes out worst? Yeah, I think it's young professionals looking to get on the property ladder for the first time. I say that as a young professional looking to get on the property ladder for the first time. But it is true. I mean, if you look at the impact on fiscal drag, the salary sacrifice changes, the stamp duty increase from last year, which has basically frozen the housing market across the country, coupled with no end in sight with taxes.

32:04There's nothing to hope for. There's nothing to look forward to. And that is literally why, and the data shows it, that so many young Brits are just leaving the country. So I think they are the most impacted. Another question, the EV drivers being taxed, which again seems a bit counterintuitive. First thing I thought when I heard that was, well, I'm not going to get an electric vehicle. I'm sure you've thought it before, Tim. But isn't it extraordinary? We're meant to be phasing out diesels and petrols. We were told that diesels were the devil incarnate. And if you dared to drive in one, then you'd have Sadiq Khan literally coming to the ATM with you and withdrawing your hard-earned cash.

32:39Now we're being told that EVs need to be taxed too. No one wants to buy them because they're so expensive. They're really expensive to repair. And apparently if the battery goes, it costs you the price of the car to replace it. And by the way, there's nowhere to charge them. and now, despite this desire to get us out of gas-guzzling cars, they're now making it less attractive to drive the alternative. What on earth? I wonder what Ed Miliband thinks about this. I think he still drives a petrol car, though, doesn't he? Does he? To his£3.4 million home. The argument is when people do make this eventual shift to EVs, they'll no longer be paying petrol tax, right?

33:17I'd love to be a... They now need to raise the money to keep the roads going from somewhere and it's going to have to be by charging them for how far you drive. There's going to be such a surge of purchases of petrol and diesel cars at the end of this decade. It's going to be unbelievable as people cling on for dear life to a car that... Well, they won't escape it either because the problem with this policy is that every chance that you could just simply extend it to petrol and diesel cars quite easily and do pay per mile for them. I have to say when Jeremy Hunt, when he increased or applied road tax to EVs in one of his budgets, It was the single most popular policy we have ever done in any budget.

33:56It gives a sense of fairness, right? It's like, well, why do EV owners not have to pay road tax? They use roads. They should pay it. So probably, certainly with Telegraph readers, I imagine, probably agree, probably a fairness argument. Everyone should pay road tax, EV or not. What advice should we give to a reader who got in touch, who's a 21-year-old master's student, Maname Lala Reikar, who asked, I was born and raised here. I'm studying at Imperial College London. I graduate in 2026. What does this budget mean for me in terms of my future job prospects? And what should I do with the money and savings I have now or that I may have in the coming years?

34:35I think we've dealt with the problem for young professionals in the graduate class, Cameron. But what should young people do with their money? There's clearly a concern about saving into pensions and they're not saving enough. If you've got spare cash, also bearing in mind what's happened to ISAs, Where should anyone lucky enough to have spare cash be saving it and putting it? Well, I would, without giving financial advice, but I would put it in an ISA. But the problem with what Rachel's done is people may be forced into investing more in stocks and equities, but they're going to be investing in US stocks and equities, right?

35:09I mean, the idea was this was meant to bring in a whole kind of capital flow into London, investing in British companies. If you download any kind of investment platform app, it's going to be Microsoft and Tesla. and NVIDIA and all these kind of high growth S &P 500 companies. People are going to be investing over there. And they may get good returns, of course. And if you don't do that, you're going to get taxed from your savings as well. But I think you'll start to see more and more people kind of slowly, hopefully investing in stocks and shares. Is my current ISA safe? Yes. It is. It's new ones.

35:41Yeah. It's new ones. All right. Good to know. We're just going to take this opportunity while I'm making this program to check. I just give all my money to a friend of mine who invests them. He says it's in an ISA in Northern Ireland. A friend of yours? Is this safe? Jesus. I don't know. I get the money back in small installments. I think it's actually, now I think about it, I think it's a Ponzi scheme. I was going to say, that friend didn't lend you that hat yesterday, did he? Jeez. I'm not paying rent on it, if that's what you mean. No, goodness me. Cameron, how damaging is the budget for aspiring entrepreneurs?

36:12Very. I mean, the changes to dividend tax were pretty bad. I mean, the whole idea of the dividend tax regime is it's supposed to recognise that setting up a business is inherently risk averse or risky. And you pay a low rate of tax accordingly. It's also not an income, so it shouldn't be treated as such. But given the increase, dividends are basically taxed as income now. So what's the point of setting up a business? Steve Jones, who's 59 and runs a security company in Wales, maybe could advise you on your investments and savings. Yeah. What is the impact of applying national insurance to salary sacrifice schemes, Cameron?

36:48The incentive of saving into your pension has pretty much disappeared, which makes absolutely no sense, given we all need to save more for our pensions. Just explain salary sacrifice for the uninitiated. You can forfeit some of your salary that artificially lowers your tax rate and put that money that you would have received as income into a pension, which is more tax efficient, which is what lots of people do. Nobody's saving in retirement. Again, I don't understand this. There's a massive problem with people not building up nest eggs. Yes, yes. And they've disincentivised it. Yes, and as the population gets older, you can see that either as a burden or a financial opportunity because you should be encouraging this generation to save so that you can have a buoyant market.

37:31That's a novel view, Tim, but not one shared by the Chancellor. Right. I hate the way in which ageing is seen as a problem in this country. And finally, a question from Marge Irene. I love the name Marge. We don't hear from enough Marges. Well, they are spread thin. It's a question from Marge Irene. You see? Sorry. You can see what they've done there. Can I just say, when I think of Marge, I think of The Simpsons. Yes, of course you do. And I wasn't thinking about pottery spreads. Thank you. No, but Marge Irene. I think that's quite clever. Anyway, Marge Irene. What, have you just worked it out?

38:06I'm really tired after my big incident. After your big incident. So clearly, Marge Areen. Yes. Well, Mrs. Areen. We've been cheaped. I trust our producers didn't see the fun. To be fair, it's a perfectly sensible question. Right, Marge Areen asks. Where is the money coming from to pay for the minimum wage increase? Borrowing and workers, productive parts of the economy. As simple as that. But hang on, she was bragging yesterday about bringing the debt down and the borrowing wasn't actually going to be as much as she thought it was going to be. And isn't she being fiscally disciplined? No, I think there's a huge credibility gap between what she was saying and actually what was in the OBR figures.

38:50I mean, borrowing is increasing. Debt is increasing. Taxes are increasing. And listening to her, you'd think it was almost the opposite. We are going to be borrowing and our debt is going to continue to increase. In fact, debt as a percentage of GDP is going to be higher at the end of the decade than it is today. And even though, remember this kind of weird 8am emergency conference, press conference she did a couple of weeks ago? Was this the Kemi saying in her rebuttal as, I'm interrupting your Cheerios? Yeah, exactly. To make this important. Something terrifying. Yes, exactly. Yeah, exactly.

39:19It was like there's a nuclear attack almost. Yes. But live from Downing Street. And she said one of her priorities is reducing debt. Well, the OBR figures said debt's going to continue to increase. So I think the credibility gap is just enormous between what she says and what's in the book. Shall we end on a more positive note? We can't really find anything particularly positive in the budget, Cameron, but a positive political thought from you, Tim Stanley. Is that the next election is going to offer a real choice. It has felt the last few years in the shadow of Covid, Ukraine, Brexit, etc. that politics is just everyone trying to do the same and pitch to the same people.

39:51But actually, the next election is going to be about do you think the state should get smaller? Do you think so many people should be on welfare? And Labour having pinned its colours to the mass and made it very clear that it's on the side of public sector welfare, there are no votes in this, by the way. No. There's no votes in increasing welfare like this. Maybe they're doing it for good moral reasons, I don't know. But it means the next election, conceptually, is going to be a more traditional left-right debate. I'm not quite sure where that leaves reform. Well, they sent me a document last night about justifying their support for the scrapping of the two-child benefit cap on the basis that they want it to apply to British both-working couples.

40:34So you have to be in a dual-income household and you have to be a British citizen in order to claim it beyond your second child. Again, conceptually, reform's approach to the economy is all about freezing foreigners out. It's about we just won't allow this money to go to this group of people. but I've yet to hear a convincing structural analysis from reform of here's how we will make the welfare system radically different. So politics used to be divided in recent memory between sort of left and right and then it was between Remain and Brexit. Yes exactly it became about identity issues. But now it's between tax up or tax down I think.

41:12People who advocate tax rises we've described them as these are the white liberal I'd like to pay more taxes go ahead be our guest and then it's the rest of us saying no i'm sorry i think we're paying enough tax thanks very much okay your article a few weeks ago about you can just give money to hmrc if you want to it is available online thank you for reading my article that's made up for the bloomberg comment right well we will be back with a royal special tomorrow because i have interviewed robert jobson about his new book the windsor legacy and my goodness he's got some tales to tell about the Queen, Harry and Meghan, and why William refuses to wear a kilt.

41:50I can't wait to find out what's underneath it. Back tomorrow at 5pm.

42:16Thank you.