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Hammond faces criticism for overplaying the impact of his tax cuts for earners…

“The chancellor has been accused of misleading people about his tax cuts for higher and moderate earners. Philip Hammond announced on Monday that the threshold at which earners start to pay 40 per cent tax instead of 20 per cent would be increased from £46,351 to £50,000 from April 2019. The move would save them up to £860 a year. But there was no mention that the threshold at which national insurance contributions drop from 12 per cent to 2 per cent was also being raised by the same amounts, which would cost them £340. The net effect was that people earning between £50,000 and £100,000 would be £520 a year better off, according to Deloitte. … While most basic-rate taxpayers will be £130 a year better off because of the rise in the personal allowance from April, the benefit will be wiped out for many by an increase in pension deductions.” – The Times

Comment:

…while McDonnell faces criticism for not criticising the reductions

“The shadow chancellor, John McDonnell, has sparked a backlash from Labour MPs by insisting that the party would not to oppose the tax cuts for higher earners announced in Monday’s budget. “We’re not going to take money out of people’s pockets. Simple as that,” McDonnell said, despite pressure from some colleagues to oppose the giveaway, which was one of the most eyecatching measures in Philip Hammond’s pre-Brexit budget. Hammond brought forward a Conservative manifesto pledge to increase the personal allowance to £12,500, and the higher-rate tax threshold to £50,000, by a year.” – Guardian

  • His MPs attack him – FT
  • He “sparks a civil war” – The Sun

UUP speaks of DUP “retreating” on “empty threat” over budget vote

A UUP peer has said the government “called the DUP’s bluff” over what was a mere “empty threat”, after the party rowed back on its threat to vote down the Budget. The DUP had previously said it was prepared to block the Budget and potentially topple Prime Minister Theresa May unless they received sufficient reassurances that there will be no Irish Sea border post-Brexit. … The East Antrim MP said: “If anyone thinks a few extra pounds is going to soften our attitude towards any Brexit deal which treats NI differently they are very mistaken … the future of Northern Ireland within the UK is more important than a few bob in your pocket.” Ex-UUP leader Lord Empey said the DUP is “retreating with their tail between their legs”.” – Belfast News Letter

  • Meanwhile, Sturgeon visits Auschwitz with Scottish students – Herald

More budget

  • Hammond is seen in better light than Osborne was at this stage – The Times
  • IFS says he’s “gambling” – Daily Telegraph
  • And dealing in “sticking plasters” – FT
  • Meanwhile, police preparing to sue government over budget cuts – Guardian

Comment:

  • Austerity is still all too real for local government – Andrew Gwynne, The Times
  • Hammond’s unilateral push on digital giants is a good idea – editorial, The Times 
  • But is he “lucky rather than good”? – Larry Elliot, Guardian
  • He brought some “welcome respite” – Leo McKinstry, Daily Express
  • I really hate stamp duty – Alex Brummer, Daily Mail

>Yesterday: Local Government: What will the Budget mean for local government?

May visits Norway. Its Prime Minister speaks of “difficulty” of allowing Britain to join EEA

“Oslo has poured cold water on a proposal from Tory MPs to adopt a Norway-style trading relationship with the EU to break the deadlock over Brexit and the Irish border. At a press conference in Oslo, Norwegian prime minister Erna Solberg said allowing Britain to become a member of the EEA/Efta trading bloc, which has a very close relationship with the EU, would be “difficult” to accept. “If you asked us if we would welcome Britain, we would welcome any good cooperation with Britain. But I don’t think it’s easy to think that you should – I know the British discussion – to enter into an organisation you are preparing to leave at the same time is also a little bit difficult for the rest of us,” she said.” – Daily Telegraph

  • Now Norway opposes “Norway for now” – The Times
  • Meanwhile, May “snubs” Bolsonaro – Daily Express

Cartoon:

  • On the Norwegian response – Steve Bell, Guardian

Comment:

  • We’ve been too rude to our European allies – Max Hastings, The Times

>Today:

Will there be an update on Brussels’ backstop today?

“Negotiations resumed in Brussels on Monday morning but it is unclear if progress has been made on the all-important backstop. Today the EU27 ambassadors will gather after it emerged Dublin was drawing up plans for a hard Brexit with increased patrols along the border and the revival of checkpoints not used since the dark days of the Troubles. The ambassadors have been told to “expect an update” on the Irish backstop stalemate, Politico Europe reports. Insiders claim Dublin’s Irish border preparations are “a lot more advanced” than was being acknowledge publicly.” – Daily Express

Nokes says employers will be responsible for checking EU nationals’ right to work in case of “no deal”

“Employers will be expected to check whether EU nationals have the right to work in the UK if there is a no-deal Brexit, even though it will be almost impossible to assess this, and the nature of the checks remain unknown, Caroline Nokes, the immigration minister, has told MPs. Her disclosure caused dismay among employers’ groups, which have said they have “serious concerns” that the Home Office may give them an impossible task with just five months left until Britain leaves the EU. In a fractious appearance before the home affairs select committee, Nokes said it would be up to companies offering jobs to EU nationals after Brexit to determine whether those applicants were eligible to work in the UK. “If somebody hasn’t been here prior to the end of March next year, employers will have to make sure they go through adequately rigorous checks to evidence somebody’s right to work … ”” – Guardian

  • She faced a “difficult” session being questioned by select committee – The Times 
  • She “doesn’t know how” the checks will work – Guardian
  • Meanwhile, Davis says “irrational fear” will prevent “no deal” in parliament – Sky News

She also speaks of hope for “reciprocal arrangements” regarding travel in case of “no deal”….

“Caroline Nokes, the immigration minister, said the government hoped that reciprocal arrangements would be agreed with the EU even if there was not a full Brexit deal. She admitted, however, that it was “not unrealistic” that British travellers could face delays if free movement ends suddenly on exit day on March 29, 2019. Ms Nokes said: “We hope very much to have reciprocal arrangements with the EU. But it is feasible there could be delays for people travelling through EU airports. The prospect of them ending up in rest of the world queues in some major EU airports across the continent is not unrealistic.”” – The Times

  • Meanwhile, there’s been a “surge” in applications for Irish passports – Daily Mail 

Comment:

  • Could “no deal” lead to recession? – Nils Pratley, Guardian

…as Latvian “eurocrat” promises to “stitch together” an “emergency pact” for financial services, if necessary

“Brussels has admitted it will allow British banks to keep carrying out major EU business even if there’s no Brexit deal. Top eurocrat Valdis Dombrovskis said he will stitch together an emergency pact with the UK to keep the financial services trade stable. The Latvian, who is in charge of the bloc’s financial stability, made the remarks amid warnings a UK crash out could cause a eurozone meltdown. Last month, a banking boss warned a no deal Brexit presented “an immediate and significant threat to financial stability” in the EU. Catherine McGuinness, the Policy Chairman at the City of London Corporation, urged Brussels to “reciprocate” British efforts to minimise disruption.” – The Sun

Could “multiple choice” option be used in debate over final deal?

“MPs debating Theresa May’s final Brexit deal could have a succession of options put before them in a rare procedure that second referendum campaigners fear will be used by ministers to select the answer that suits them best. The clerk of the House of Commons has suggested that if ministers held to their insistence that no amendments could be put to May’s final deal for legal reasons, “stand-alone consecutive motions” could be debated instead. Sir David Natzler is due to give evidence to MPs on the Brexit select committee on Wednesday morning, where he is expected to be questioned on the multiple choice procedure that could include an option to hold a second referendum.” – Guardian

Hunt to announce post-Brexit diplomatic “shake-up” plans, including decision to appoint non-civil-servant business leaders as ambassadors

“Britain will hire business leaders instead of career civil servants as ambassadors after Brexit to boost the nation’s relations with the rest of the world, Jeremy Hunt will announce on Wednesday. The Foreign Secretary will set out plans to open up top diplomatic jobs to non-civil servants as part of a push to recruit “under-represented groups” to act on behalf of the UK on the global stage. Mr Hunt wants to shake up the state of the UK’s overseas diplomatic operations so that the nation is well-prepared to redefine its relationship with the rest of the world once Britain has left the European Union in March 2019.” – Daily Telegraph

  • Security minister speaks of chance to “unilaterally lay international sanctions” on dirty money after we leave – Daily Telegraph
  • He also discusses football laundering investigations – The Times

Osborne “takes blame” for Brexit result

“George Osborne has admitted harbouring “regrets” about his time in government, saying their approach to the EU and immigration led to the Brexit result in the referendum. A day after his Treasury successor unveiled one of the biggest giveaway Budgets in recent history, the former chancellor also warned the Tories not to seek to “out-Corbyn Corbyn” and emulate Labour’s approach to public spending. Challenged on the BBC’s Newsnight programme to name something he regrets, he said the Conservative Party “did get things wrong” in the lead-up to the Brexit vote.” – Daily Telegraph

  • Major says Brexiters “will be held accountable” in the future – Daily Express

News in Brief

  • How Hammond betrayed the environment,  – New Statesman
  • My thoughts on Brexit – Tony Abbott, Spectator
  • We need to think about opportunity costs of leaving – Madeline Grant, CapX
  • Here’s what Bolsanaro’s victory should teach you – Daniel Hamilton, Reaction

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