A chunky increase in public sector pay would, realistically, have to be financed by spending cuts and long-term savings – through driverless trains, for example.
The public will react very badly if they come to see the strikes as essentially political, but the Conservatives won’t want to appear unable to govern.
It needs to pull the help it has already provided into an account that shows the scale of the adjustment we are going through.
Voters aren’t used to a world of rising prices and interest rates, and their hearts and minds are up for grabs.
But unless the Party offers them a genuine shot at prosperity, it risks sliding into decline.
A key economic problem during the 1980s was union power. Now it is weak incentives to move and retrain.
Of the main tax cut candidates urged on the Chancellor, the best available is a VAT fuel reduction.
Our troubles will be compounded by Ministers’ import promotion policies, most pronounced in the Business, Energy and Agriculture departments.
Building up economic resilience will be necessary for a successful response to Brexit, Covid recovery and the transition to Net Zero.
The fundamental problem is that costs are going up faster than we are getting more productive.
Lumping more onto the UK’s tax burden – already at the highest sustained level seen in peacetime – cannot be the answer.
Gove is ready to localise as much either as he wants to or as his colleagues will let him, or both. I hope it’s work in progress.
The fourth part of a ConHome series this week on Levelling Up as the Government’s White Paper nears publication.
We should never forget the millions of people who are “just about managing” – they will find it harder to budget over the next few months.