Gordon Brown is right – Britain needs an emergency Budget

The task of all governments of whatever political hue is to protect their most vulnerable citizens from hardship. The UK managed reasonably well to do so when the pandemic struck in 2020. It has made a start on trying to do so again when the current surge in inflation took off earlier this year. But it now needs to do more, much more.

Specifically, there has to be emergency action to blunt the impact of the surge in energy prices that will gather pace through the autumn.

Gordon Brown, former chancellor and the prime minister who led the response to the financial crisis of 2008-9, has called for an emergency Budget to tackle this new crisis. It is a thoughtful and helpful intervention. He backs a report by Professor Donald Hirsch, of Loughborough University, which argues that the present measures taken by the government will not be sufficient to make up for the recent surge in living costs.

The report looks at the extent to which the measures already announced will compensate for the additional burden on low-income families, not only from the expected rise in energy prices in October but also from cuts in universal credit and the inadequate uprating of benefits.

Professor Hirsch is an experienced and respected expert on how the state can best tackle social harms. His report has been backed by 56 charities, including the Joseph Rowntree Foundation and the Child Poverty Action Group. It deserves to be taken very seriously.

The debate over the adequacy, or otherwise, of the response of the government to the cost of living crisis has become bound up with the election of the new leader of the Conservative Party and therefore the prime minister. Liz Truss has emphasised the importance of tax cuts rather than “handouts” as a way of reviving the economy. Gordon Brown, however, highlights that this is not simply an economic or political issue. It is a moral one.

He makes the point this way: “We need targeted support for families on the lowest incomes, not just cuts in taxes or flat rate payments, which don’t account for the specific needs of people on the brink of poverty. There should be no argument that a permanent increase in universal credit is the only way to take a sure step towards a solution.

“This crisis goes far beyond politics; this is a moral issue – our responsibilities to our neighbours and in particular to those who have the least and whose needs are the greatest.”

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This must surely be right. Let’s see how the two candidates respond. Rishi Sunak is the principal architect of the government’s current plans, and we should hope that he can show flexibility by acknowledging that further measures need to be taken. We should hope that Liz Truss, for her part, is prepared to admit that to target support to the families most in need during a crisis should not be dismissed as giving “handouts”.

This is a truly defining moment in British politics. It is a debate that will shape the future direction of the Tory party, whoever its members choose to be its leader. But more than this, it is one that will determine how well our democracy can respond to a social and economic crisis.

The UK government cannot control global energy or food prices. But it can and must protect its most vulnerable citizens from external shocks of this magnitude. It has the resources to do so. And now, thanks to the work of Professor Hirsch, it has a blueprint of what must be done.