Counting the cost of Labour's policies of tax and spend; property matters.

Byline: Richard Jones

BRILLIANT leadership or epic mismanagement? The newspapers are asking that question, but it is something on all our minds, I am sure.

The raft of measures announced by Captain Darling in this week's pre-budget report is a rather big dose of medicine that is meant to get rid of those economic aches and pains. Trouble is, it is going to leave us all with a huge hangover for the next few years.

Pundits were asking if Mr Darling looked like a gambling man. Clearly he doesn't, but what he has unleashed this week is an extraordinary gamble that will either pay him and New Labour an unimaginable return (to office for a fourth term), or dig a hole so deep that we will not see the light for years.

You see there is no such thing as a free lunch. What you have today, you must be able to pay back tomorrow. The government is proposing to borrow massive sums from future generations to provide a stimulus to the economy now, so that we spend our way out of this recession early and can then afford the future debt through greater economic growth. But has he gone about it the right way and is it targeting the right people? Put simply, is VAT enough?

No. It isn't. Are you, as a consumer, going to run out on Monday and buy more goods than you would have anyway to save pounds 2.50 in every pounds 100?

No, you're not. Will retailers already squeezed by having to lower their prices already in the last few months, lower their prices again. No, they won't. They will just take it as a bit of extra profit.

No, if you add up what it will cost us in extra duty on fuel, fags and booze plus the additional costs of our National Insurance contributions and the now inevitable tax rises that will impact on all of us, we are absolutely not going to be better off.

What we care about is our homes and our jobs. If we have confidence in these two things and if we have a bit more money in our pockets through, for example, tax breaks on personal allowances or even straight tax cuts, that's when we will go out and spend.

The one cheer that went up from Labour MPs in the Commons was around the new taxes on the rich to pay for some elements of this programme.

Who cares! What it in fact signals for us is that we will now have a straight choice when we vote at the next election. The battle lines have been drawn on the economy and who is best placed to manage it.

Labour was the party of tax and spend. Labour is the party of tax and spend. They have had a chance to do something of significance out of this crisis and at first glance it would appear they have missed that chance.

Brilliant leadership or epic mismanagement? You will decide.

Richard Jones is director of boutique housebuilder, Ludlow Lewis, currently building 21 bespoke homes on the site of the former Collins Dairy in Llantrisant.

www.ludlowlewis.co.uk