WEBVTT - Bean Counters Beware 0:00:00.520 --> 0:00:03.200 I think what it demonstrates is an impatience on the 0:00:03.200 --> 0:00:05.040 part of the Prime Minister and a new Chancellor with 0:00:05.120 --> 0:00:09.560 what they see as orthodox treasury thinking. And I think 0:00:09.680 --> 0:00:14.440 that she is suspicious of the Treasury, is reluctant to 0:00:15.040 --> 0:00:18.960 agree to spending money. I think she regards the treasures 0:00:18.960 --> 0:00:33.839 too cautious. And I think that David Linnington, they're a 0:00:33.880 --> 0:00:36.159 former minister for the Cabinet Office who actually joined us 0:00:36.200 --> 0:00:38.040 in an interview a little bit earlier on this week 0:00:38.080 --> 0:00:41.720 to discuss the ousting of the Treasury's most senior civil servant. 0:00:42.080 --> 0:00:43.960 That's right, fran See. And of course we have the 0:00:44.080 --> 0:00:46.640 huge stories still dominating the news of the death of 0:00:46.720 --> 0:00:49.040 Queen Elizabeth the Second. Officially we are in a morning 0:00:49.080 --> 0:00:52.360 period that means there should be no government business actually 0:00:52.400 --> 0:00:56.800 happening this week. However, however, the new Prime Minister is 0:00:56.840 --> 0:00:59.800 doing exactly that. She's setting the turn for administration and 0:01:00.000 --> 0:01:02.800 he's made changes. That's right. They she has fired or 0:01:02.800 --> 0:01:05.520 her new chance to Quasi quarteng has in in his 0:01:05.600 --> 0:01:07.800 second day on the job, he has sacked a very 0:01:07.840 --> 0:01:12.240 senior civil servant called Tom Scholar. This has caused waves 0:01:12.319 --> 0:01:15.160 around the civil service, to the government and more broadly, 0:01:15.200 --> 0:01:17.520 because what it shows is that the UK government is 0:01:17.560 --> 0:01:21.320 going to push ahead with it's very zealous reform of 0:01:21.360 --> 0:01:26.559 Britain's economic policy. I'm David Merritt and I'm Francine Laque 0:01:27.040 --> 0:01:29.880 and this is in the City, Bloomberg's podcast, connecting you 0:01:29.920 --> 0:01:32.119 to the stories at the heart of the City of London. Now, 0:01:32.160 --> 0:01:35.080 this week the Beam counters Dave get the Boot look 0:01:35.080 --> 0:01:37.880 at liszt Trust's mission to bring the civil service into 0:01:37.959 --> 0:01:40.480 line and what that tells us about her plans for 0:01:40.480 --> 0:01:43.160 the economy. Yes, and joining us this week we have 0:01:43.240 --> 0:01:47.000 a Lego Straton, author of our daily UK newsletter, The Readout, 0:01:47.400 --> 0:01:51.240 and former Downing Street Press secretary, and Philo Audrick are 0:01:51.360 --> 0:01:54.280 UK EK reporter. What happened? I can't I mean, I 0:01:54.280 --> 0:01:57.400 can't believe what They two into the job and suddenly 0:01:57.680 --> 0:01:59.920 you realize a Legro that the Prime Minister, through a 0:02:00.040 --> 0:02:02.680 transfer sacked a top civil sort event. Well, the funny 0:02:02.720 --> 0:02:06.600 thing is as well that because of the nation going 0:02:06.600 --> 0:02:09.600 into mourning, you didn't really realize because it was it 0:02:09.760 --> 0:02:12.400 was not really that high profile because all of us 0:02:12.440 --> 0:02:14.560 were focused on the not supposed to do anything right, 0:02:14.560 --> 0:02:16.560 I mean, the government supposed to do any business during 0:02:16.600 --> 0:02:18.760 this period, right, That is a good point, Dave. But 0:02:18.800 --> 0:02:20.960 we now know, we've seen that this is a government 0:02:20.960 --> 0:02:23.400 that intends to do things differently. They're in a hurry 0:02:23.639 --> 0:02:27.799 and things are being broken on Tom Scholar. I think 0:02:27.800 --> 0:02:29.760 it's important to remember that the guy who's now the 0:02:29.800 --> 0:02:33.760 new Chancellor was the Business Secretary and potentially Quasi Quoteng 0:02:33.840 --> 0:02:36.760 over time felt that the Treasury was you know, he 0:02:36.800 --> 0:02:39.560 would have had a front row seat slash interaction with 0:02:40.240 --> 0:02:43.800 that the Treasury and he will probably over time have 0:02:43.919 --> 0:02:45.959 felt that it you know, he would have seen very clearly, 0:02:46.000 --> 0:02:48.760 but also have felt it wasn't doing quite what he 0:02:48.800 --> 0:02:51.680 would like. And so it isn't like we have a 0:02:51.680 --> 0:02:54.600 completely new government that didn't have any interaction with these characters. 0:02:54.880 --> 0:02:57.600 There will be people who you know, Quasi and others 0:02:57.680 --> 0:03:00.440 officials and his advisers who will have felt we need 0:03:00.560 --> 0:03:03.840 we need a personnel change. This movie feels so profound 0:03:04.000 --> 0:03:06.720 right in this meaning a film. Is it to send 0:03:06.720 --> 0:03:09.200 a warning shot to others and saying you phull into line, 0:03:09.720 --> 0:03:12.919 you look at growth, stop counting the beans, or you're out, 0:03:13.120 --> 0:03:15.760 or is it just a campaign promise. It's definitely is 0:03:15.800 --> 0:03:18.040 the attempt to change the mindset at the top of 0:03:18.080 --> 0:03:20.800 the Treasury. I mean, obviously it's just Tom Skoller who's 0:03:20.840 --> 0:03:23.040 going They're not they're not sacking you know, the whole 0:03:23.720 --> 0:03:26.359 clairel On Bedelli and the other people right through the treasury. 0:03:26.400 --> 0:03:29.840 So it's like a warning shot, fall into line or 0:03:29.960 --> 0:03:32.440 you're in trouble. I think it's the way to read it. 0:03:32.600 --> 0:03:35.440 The idea is, as they've said, to focus more on growth, 0:03:35.480 --> 0:03:37.920 and there have been changes within Treasury which have been 0:03:37.920 --> 0:03:40.560 moving in that direction a little bit previously, so this, 0:03:40.880 --> 0:03:43.200 I guess, is to really accelerate that process. I mean, 0:03:43.200 --> 0:03:44.840 he's not a household name, right Tom Scott, I mean 0:03:44.840 --> 0:03:46.760 who tell us a bit more about him? And do 0:03:46.800 --> 0:03:48.080 you know who did you work with him? What did 0:03:48.080 --> 0:03:49.800 he stand or was did he did he stand with 0:03:49.840 --> 0:03:52.160 the bean counters. But they're not household names. They're not 0:03:52.200 --> 0:03:54.480 meant to be happening. By definition, they're meant to not 0:03:54.520 --> 0:03:56.720 be household names. And I think any any prime minister 0:03:56.760 --> 0:03:58.360 would be very wary of a perm sect that have 0:03:58.480 --> 0:04:01.000 become a house on name. They're meant to be behind 0:04:01.040 --> 0:04:04.920 the scenes officials providing expert advice. I think the tension 0:04:05.000 --> 0:04:06.880 you get into with the Treasury, which we are going 0:04:06.920 --> 0:04:10.400 to see being tested now, is to what extent he 0:04:10.480 --> 0:04:12.960 is there to provide advice to the Chancellor and then 0:04:12.960 --> 0:04:15.720 the Chancellor provides advice to the Prime Minister, or the 0:04:15.880 --> 0:04:19.800 extent to which that the Treasury is became this this 0:04:20.040 --> 0:04:23.360 rival ideas powerhouse. One of the things that I think 0:04:23.480 --> 0:04:25.640 is the interesting implication when you look at what they're 0:04:25.640 --> 0:04:28.640 now trying to do with these very innovative and to 0:04:28.720 --> 0:04:32.440 be welcomed policy programs around the energy package for business, 0:04:32.880 --> 0:04:35.359 you know you need institutional knowledge there, and so the 0:04:35.640 --> 0:04:39.200 key question will be where the Tom scholars departure means 0:04:39.520 --> 0:04:41.640 that you've lost a little bit of that muscle memory 0:04:41.760 --> 0:04:43.760 and a bit of that you know, I was in 0:04:43.760 --> 0:04:47.440 the Treasury and I worked alongside Tom Scholar when they 0:04:47.520 --> 0:04:51.240 we devise the furlough. It happened very quickly. That's the 0:04:51.279 --> 0:04:55.119 last manual you have on the shelf for doing stuff differently. Again, 0:04:55.160 --> 0:04:56.760 when we did things like eat out to help out, 0:04:56.760 --> 0:04:59.280 you know you you are you are doing policies where 0:04:59.320 --> 0:05:02.360 there is not no one's done it before, there's no precedent. 0:05:02.440 --> 0:05:05.080 You are being told by officials that's not going to work, 0:05:05.320 --> 0:05:06.880 and so you're trying to find a way around it, 0:05:06.960 --> 0:05:09.240 and that is a creative relationship. It's not always a 0:05:09.240 --> 0:05:11.480 bad relationship that then they're they're not, by the way. 0:05:11.760 --> 0:05:14.520 Usually sometimes it is the case, but they're not always 0:05:14.560 --> 0:05:16.599 just saying no because they want to. They're saying no 0:05:16.720 --> 0:05:19.719 because it can't work. So so there's an interesting question 0:05:19.760 --> 0:05:22.280 around you have this new government that wants to do 0:05:22.320 --> 0:05:25.320 it things very differently. Can you do it when you've 0:05:25.360 --> 0:05:27.679 lost one of the key characters? And by the way, 0:05:27.839 --> 0:05:30.360 you have standings right now, but you'll take whoever comes 0:05:30.360 --> 0:05:33.520 next sometime together. Head around that the people, their teams, 0:05:33.680 --> 0:05:36.920 their expertise, the brain trust of the treasury hasn't been 0:05:36.920 --> 0:05:39.400 affected apart from this one person at the top. And 0:05:39.440 --> 0:05:41.760 the sense that you know you get is that they believe. 0:05:42.160 --> 0:05:46.760 People around the new government believe that he could have 0:05:46.800 --> 0:05:50.120 proved an obstacle to sort of re engineering the treasury 0:05:50.160 --> 0:05:55.400 because of ideological clashes. Now the fact that they got 0:05:55.480 --> 0:05:57.920 rid of him is an ideological move, and that is 0:05:57.960 --> 0:05:59.760 the type of thing that shouldn't be happening that this 0:06:00.040 --> 0:06:04.599 high level in the civil service, because everyone should understand 0:06:04.600 --> 0:06:06.960 obviously that the civil service will do what it's told. Now, 0:06:06.960 --> 0:06:09.360 I don't know if they always do. I can't promise that. 0:06:09.400 --> 0:06:13.000 But just the act of sacking scholar is is pretty 0:06:13.040 --> 0:06:15.839 shocking because it is saying there's there's these ideological devices 0:06:15.880 --> 0:06:18.560 introducing politics into an a political sphere effectually during an 0:06:18.640 --> 0:06:20.960 energy crisis. During a crisis, it makes it even more 0:06:21.080 --> 0:06:23.440 But this was Lizzar's trust campaign, right, it was like 0:06:23.520 --> 0:06:27.720 she didn't believe in orthodox economics. So is this how 0:06:27.760 --> 0:06:30.680 she's going to govern as Prime minister? It's clear she 0:06:30.760 --> 0:06:34.159 doesn't want to be stopped in her growth boosting policies. Now, 0:06:34.480 --> 0:06:36.800 when I said only there's been some changes in government 0:06:36.800 --> 0:06:38.440 in terms of trying to refocus on growth. There's a 0:06:38.480 --> 0:06:40.880 thing called the Green Book, which if you do cost 0:06:40.880 --> 0:06:44.359 benefit analysis for every pound that's invested in Rhodes or whatever, 0:06:44.400 --> 0:06:45.719 and you have to work out, you know, what's the 0:06:45.720 --> 0:06:47.760 best way of doing and that was a very beam 0:06:47.839 --> 0:06:50.160 counting process. And actually Rishi was changed. He changed the 0:06:50.240 --> 0:06:52.000 rules on the on the Green Book to make it 0:06:52.040 --> 0:06:54.640 easier to actually invest in things even if the numbers 0:06:54.680 --> 0:06:57.680 didn't add art necessarily. And so you have these tiny 0:06:57.720 --> 0:07:00.320 little moves in that direction, and clearly they've youre that 0:07:00.320 --> 0:07:03.080 that that sort of process of change is so slow 0:07:03.440 --> 0:07:05.960 that they just want to push it extraordinarily fast. And 0:07:06.000 --> 0:07:07.760 if you think she's only got two years to deliver, 0:07:07.839 --> 0:07:10.360 and she's like, I'm delivered, delivered, deliver, she needs to 0:07:10.400 --> 0:07:13.320 do everything extraordinarily quickly. So any sense of an obstacle 0:07:13.360 --> 0:07:15.040 in the way she probably want to get. How are 0:07:15.040 --> 0:07:18.600 economists reading this then? I mean, are people the people 0:07:18.600 --> 0:07:20.960 who are crunching the numbers are making a forecast for growth, 0:07:21.040 --> 0:07:24.760 you know, widespread forecasts for a recession in this country. 0:07:25.240 --> 0:07:29.040 She's talking about a huge fiscal stimulus with the energy package. 0:07:29.920 --> 0:07:31.960 Do people think it's gonna work? Well? I mean this 0:07:32.440 --> 0:07:35.400 like the one thing she's doing is introducing policy sort 0:07:35.440 --> 0:07:39.360 of uncertainty and concerns like everywhere, Like you've got enormous 0:07:39.360 --> 0:07:41.400 amount of borrowing. We don't know how much because she 0:07:41.560 --> 0:07:44.360 haven't told us yet coming for the energy package, the 0:07:44.400 --> 0:07:47.000 business support plan, you know, they haven't actually drawn it up. 0:07:47.040 --> 0:07:48.920 It's just a bunch of words at the moment. You know, 0:07:48.960 --> 0:07:50.760 the Bank of England that we're going to change the 0:07:50.800 --> 0:07:54.160 mandate and then you sack this sort of very stable 0:07:54.200 --> 0:07:56.640 figure at the top of the treasury. And so the 0:07:56.680 --> 0:07:59.480 markets are not liking economists are not liking it the 0:07:59.520 --> 0:08:02.280 streets saying, you know, we this this is just adding 0:08:02.280 --> 0:08:04.800 to the uncertainty, and we're seeing the pound react as 0:08:04.840 --> 0:08:08.480 a result. We were already saying, people like Phil and I, 0:08:08.560 --> 0:08:10.920 before we heard the energy package, that it was a gamble, 0:08:11.200 --> 0:08:12.880 because we knew she was going to come in and 0:08:12.920 --> 0:08:15.800 she had this different Liz orthodoxy, if you like, which 0:08:15.960 --> 0:08:18.720 was my way or the highway. We're going to cut 0:08:18.760 --> 0:08:22.080 taxes and that way we're going to boost growth, and 0:08:22.240 --> 0:08:23.960 a lot of economists were saying, well, I'm not sure 0:08:24.000 --> 0:08:27.240 about that. So she already had this kind of intellectual 0:08:27.280 --> 0:08:29.560 economic gamble which she was going to unfall on us 0:08:29.600 --> 0:08:35.040 all and then having said during the leadership campaign no handouts, 0:08:35.080 --> 0:08:38.280 she has now announced. Not only has she announced, I'm 0:08:38.320 --> 0:08:41.200 not saying necessarily that she is is wrong. I mean, 0:08:41.240 --> 0:08:43.240 there's a lot of people who think that had Richie 0:08:43.280 --> 0:08:45.720 got in or whoever was going to be in charge 0:08:45.760 --> 0:08:47.080 and the autumn is going to need to do something 0:08:47.080 --> 0:08:49.719 along these lines. It's just the magnitude that it's extraordinary. 0:08:49.840 --> 0:08:52.480 And also in the context of saying no handouts and 0:08:52.520 --> 0:08:55.920 then whatever the biggest handout, I mean, everybody agrees it's 0:08:55.920 --> 0:08:58.680 an extraordinary magnitude, you know, I mean this needs to 0:08:58.720 --> 0:09:01.200 be said. You know, there are Martin Lewis is a 0:09:01.360 --> 0:09:05.400 very well respected, important and alert campaign are very worried 0:09:05.400 --> 0:09:08.160 about households this winter. You know, people like him think 0:09:08.200 --> 0:09:11.160 this will go a long way to addressing real vulnerability. 0:09:11.280 --> 0:09:13.480 So we spoke to the former Transfer Philip Penland and 0:09:13.480 --> 0:09:15.800 he was saying, well, the only thing to keep the 0:09:15.840 --> 0:09:19.320 government check is the market. The markets are looking very 0:09:19.440 --> 0:09:23.840 very closely at political pronouncements and the UK does face 0:09:23.920 --> 0:09:27.400 some serious headlines. We've got a big balance of payments challenge. 0:09:27.480 --> 0:09:30.240 The pound has had a pretty tough time over the 0:09:30.320 --> 0:09:33.600 last six months, and I think there's a very strong 0:09:33.720 --> 0:09:36.760 need for the government to provide not only reassurance to 0:09:36.800 --> 0:09:40.680 its citizens that it will provide short term help to 0:09:40.760 --> 0:09:45.000 get through this winter, but to markets that it does 0:09:45.080 --> 0:09:48.640 get the fact that it can't keep on printing money 0:09:48.679 --> 0:09:52.760 to bail people out from these challenges. I mean, is 0:09:52.800 --> 0:09:55.000 it an obstacle when you're in government do you look 0:09:55.040 --> 0:09:58.240 at do you listen to head funds or look at 0:09:58.480 --> 0:10:01.800 you know, sterling and guild. Somebody said to me the 0:10:01.840 --> 0:10:04.680 other day that the pound is the nation's share price. 0:10:04.880 --> 0:10:07.720 So they in government, they do look at it. I 0:10:07.720 --> 0:10:12.240 think the thing about this government, Quasi is one of 0:10:12.280 --> 0:10:16.960 the most incredibly astute and bright and well read, and 0:10:17.000 --> 0:10:21.760 indeed he's an author himself. Politicians we've seen in recent times. 0:10:21.760 --> 0:10:25.800 He's very intellectually confident, and he I think has formed 0:10:25.800 --> 0:10:28.000 a view and and there's there's some credence to this. 0:10:28.080 --> 0:10:30.800 He's formed a view that people will wear more borrowing 0:10:31.400 --> 0:10:34.959 and that this is a wartime situation and that this 0:10:35.360 --> 0:10:38.319 government needs to spend and borrow. But we don't know 0:10:38.400 --> 0:10:41.520 because we're waiting for the actual price tag in next week, 0:10:41.840 --> 0:10:45.080 but borrow money we expect um and that the markets 0:10:45.080 --> 0:10:47.720 will wear it. And I think the evidence point he 0:10:47.760 --> 0:10:49.840 has for that is if you look back during the 0:10:49.840 --> 0:10:52.559 furlough and so on, there was this sort of nervousness 0:10:52.600 --> 0:10:55.120 in government about how much can we push it? And 0:10:55.120 --> 0:10:57.079 in the end the answer was you could. You could. 0:10:57.240 --> 0:10:59.480 Not only were other countries around the world doing the same, 0:10:59.520 --> 0:11:01.320 but it was the right thing to do and had 0:11:01.360 --> 0:11:03.520 they not you'd have had mass unemployment and so on. 0:11:03.600 --> 0:11:07.839 So he's very very anyway, a very very intelligent, clever 0:11:08.320 --> 0:11:11.719 chap and he has made a formed of view with 0:11:11.840 --> 0:11:14.520 his very very close and old friend Liz trust that 0:11:14.559 --> 0:11:17.040 they can they can push it. Of course, you've got 0:11:17.040 --> 0:11:19.520 to remember that the counter factual here is that doing 0:11:19.559 --> 0:11:22.120 nothing was going to just punch a massive, massive hole 0:11:22.120 --> 0:11:24.040 in the public finances anyway, because you're going to have 0:11:24.080 --> 0:11:26.720 a very very deep recession, which now it looks like 0:11:26.760 --> 0:11:29.040 we could avoid, like the UK could avoid a recession 0:11:29.120 --> 0:11:33.640 if this, if this energy bailout plan does work, you know, optimally. 0:11:33.920 --> 0:11:36.760 But there are rumors and actually the tax cuts that 0:11:36.800 --> 0:11:41.480 they promised will be limited in scope. Another I don't know, 0:11:41.520 --> 0:11:45.800 I don't know what's coming on. We're going to learn. 0:11:45.960 --> 0:11:48.079 We will learn all about this when we because it 0:11:48.120 --> 0:11:50.320 supposedly going to come out next week. But yeah, I 0:11:50.320 --> 0:11:52.559 mean those cuts of sort of thirty billion plus a years, 0:11:52.600 --> 0:11:55.040 I mean they're considerable. That One of the lessons from 0:11:55.040 --> 0:11:58.000 the pandemic is we spent years actually do fiddling around 0:11:58.040 --> 0:12:00.600 on the edges of making small policy changes, and like 0:12:00.800 --> 0:12:02.720 like two or three billion here always felt like a 0:12:02.760 --> 0:12:06.640 big policy. This is a thirty billion pound tax change, right, 0:12:06.840 --> 0:12:10.120 And it's like the pandemic showed, you know, how do 0:12:10.120 --> 0:12:13.200 you get inflation you spend four billion quid or you know, 0:12:13.240 --> 0:12:16.280 there's all you know, you get you do. You basically 0:12:16.280 --> 0:12:19.600 make big discore moves and they actually do affect the economy, 0:12:19.600 --> 0:12:23.360 and thirty billion might do something for growth. It's a bigger, 0:12:23.400 --> 0:12:26.000 it's a big You have a billion here been in 0:12:26.040 --> 0:12:28.559 there that it would be said to be unraveling if 0:12:28.559 --> 0:12:31.120 someone said it wasn't costed somewhere else. And I mean 0:12:31.160 --> 0:12:33.360 this is just slightly on another planet. This is the 0:12:33.400 --> 0:12:36.800 new normal, the new normal. The systems are bigger. Yeah, 0:12:36.800 --> 0:12:39.200 but the balance of payment hasn't it's still there that 0:12:39.200 --> 0:12:42.320 that's not changed. Yeah, I mean that's pretty funny. So 0:12:42.400 --> 0:12:45.040 the real numbers are actually slightly distorted. The owners says 0:12:45.080 --> 0:12:48.480 that the eight point five record deficits can't be fully 0:12:48.480 --> 0:12:50.480 trusted because there's been a break in the data. But 0:12:50.520 --> 0:12:52.520 even so it cooms to say it's five to six percent, 0:12:52.600 --> 0:12:54.920 which is twice what we were coping with before. And 0:12:55.080 --> 0:12:57.440 the kindness of strangers of people going to still invest 0:12:57.480 --> 0:13:00.240 in the UK. The pound does look very fragile. It's 0:13:00.280 --> 0:13:02.960 not a good backdrom. But there's one other thing to mention, 0:13:02.960 --> 0:13:06.360 which I always thought before it looked like Lisztrust was 0:13:06.400 --> 0:13:08.920 going to win that in some ways was more pertinent 0:13:08.960 --> 0:13:11.920 to your listeners and to Bloomberg readers, was was what 0:13:12.040 --> 0:13:14.600 happens on the protocol and with Northern Ireland, because I 0:13:14.600 --> 0:13:17.760 think that that feels like actually the thing that people 0:13:17.800 --> 0:13:20.920 are wanting movement on in order to make investment decisions 0:13:20.920 --> 0:13:23.360 and so on. So I actually always thought ahead of 0:13:23.400 --> 0:13:25.839 her becoming leader that some of the other parts. I 0:13:25.880 --> 0:13:28.000 didn't know about the hundred and fifty billions at that point, 0:13:28.040 --> 0:13:31.079 but the other parts were probably something that would be absorbed. 0:13:31.120 --> 0:13:34.160 But actually, unless there was real progress on the protocol, 0:13:34.440 --> 0:13:36.559 that would be the thing that would continue to cast 0:13:36.679 --> 0:13:38.920 some kind of chill over the over the UK's economy. 0:13:39.000 --> 0:13:41.800 And if we were to interpret her actions talking about 0:13:41.800 --> 0:13:46.000 sacking Tom Scholar, she's not afraid to do provocative things. 0:13:46.080 --> 0:13:49.160 So from that can we extrapolate that she's prepared to 0:13:49.160 --> 0:13:52.440 blow up the protocol? But it doesn't doesn't doesn't look 0:13:52.480 --> 0:13:55.800 like it. But we can't quite untangle the extent to 0:13:55.840 --> 0:13:58.040 which what we're dealing with at the moment is a 0:13:58.120 --> 0:14:00.280 nation and the government in mourning, and that you know, 0:14:00.440 --> 0:14:04.560 clearly we saw King Charles in Northern Ireland yesterday. Clearly 0:14:04.640 --> 0:14:09.280 everybody has agreed to to pause on all matters related 0:14:09.320 --> 0:14:11.800 to the protocol, which is obviously the right thing. And 0:14:11.800 --> 0:14:14.280 we're haven't the grace period extended? I mean some some 0:14:14.360 --> 0:14:16.360 people do say the grace period will continue to be 0:14:16.360 --> 0:14:21.320 extended and extended and extended is what we live with 0:14:21.560 --> 0:14:23.640 and what we're trying to arrange is the permanent. So 0:14:23.680 --> 0:14:25.840 we can't quite figure out the extent to which the 0:14:25.880 --> 0:14:29.880 pause is because of mourning or whether it's because actually 0:14:30.240 --> 0:14:32.800 her government is choosing and I don't know the answer 0:14:32.840 --> 0:14:35.720 to this is choosing to be extremely radical on its 0:14:35.760 --> 0:14:40.240 tax cuts and on its bid to to sort energy 0:14:40.360 --> 0:14:43.320 the energy crisis out, but in other ways will will 0:14:43.520 --> 0:14:47.560 will will trim. This feels very like, you know, Ronald Reagan. 0:14:47.600 --> 0:14:49.920 This is like Reaganism. It's back with a vengeance. Do 0:14:50.040 --> 0:14:57.280 be encounters matter? Yes? They do? I mean, are you sure? Yeah? 0:14:57.320 --> 0:15:00.160 I mean, here we are the economists Bloomberg. Surely, the 0:15:00.160 --> 0:15:02.120 being counters matter. They They're very important. I mean, the 0:15:02.200 --> 0:15:05.240 Office of Budget Responsibility is the being counter in chief, 0:15:05.400 --> 0:15:07.680 and it is telling that they the document that they're 0:15:07.680 --> 0:15:09.360 going to release, the fiscal Statement is not going to 0:15:09.400 --> 0:15:12.240 be costed by the o b R next week. There 0:15:12.240 --> 0:15:13.960 will be a budget later in the year where there 0:15:13.960 --> 0:15:16.120 will be a sort of OBI costumes. So the bean 0:15:16.160 --> 0:15:19.800 Counters tells something as well. Right, she's sidesteps the being 0:15:19.840 --> 0:15:22.600 counter in chief for the purposes of this budget. That 0:15:22.800 --> 0:15:26.000 is so, I think because as far as I understand, 0:15:26.120 --> 0:15:27.640 what they're going to do with this is they're going 0:15:27.720 --> 0:15:31.200 to put in the tax cuts alongside the big energy 0:15:31.200 --> 0:15:33.920 bill stuff, and then they're going to want the dynamic 0:15:33.960 --> 0:15:38.600 growth model because inflation will mechanically be lower, so the 0:15:39.240 --> 0:15:41.840 cost of the national debt will come down, so that 0:15:42.040 --> 0:15:43.320 she wants to. I think they're going to want to 0:15:43.320 --> 0:15:46.320 put in all of these kind of moving parts. It's 0:15:46.360 --> 0:15:48.600 a bit like Gordon Brown before the OBRE was set up, 0:15:48.640 --> 0:15:51.920 where you can control effectively what the result is once 0:15:51.960 --> 0:15:54.240 you put put the equation together with the O b R. 0:15:54.640 --> 0:15:56.720 They don't control it. So it's quine that kind of 0:15:56.760 --> 0:15:58.920 handy to to leave the OBI are to one side 0:15:58.920 --> 0:16:01.120 of this. Even we are right, well, you can blame 0:16:01.160 --> 0:16:05.360 them if something goes wrong. Is that they because they 0:16:05.640 --> 0:16:09.600 blame the bean counters if something goes wrong you is 0:16:09.600 --> 0:16:14.880 it like get out class? I don't think then they 0:16:14.880 --> 0:16:17.560 can get it wrong, doesn't it? But it's somebody marking 0:16:17.560 --> 0:16:20.720 your homeworks Yeah, it was set up, wasn't it. Tonge 0:16:20.800 --> 0:16:25.480 government over spending perhaps two billion pounds on support, stopped 0:16:25.560 --> 0:16:29.680 fiddling the book social sie stepping. So surely they've outlived 0:16:29.680 --> 0:16:32.720 their useful, haven't. I mean, people are saying are they 0:16:32.760 --> 0:16:34.920 going to actually continue with the I mean, but again 0:16:34.960 --> 0:16:36.720 it's one of those things where in all of this 0:16:36.800 --> 0:16:39.120 policy uncertainty, to get rid of the guy who checks 0:16:39.120 --> 0:16:41.480 your homework is only going to make the market scape. 0:16:41.520 --> 0:16:43.640 I'm really not sure about this country, that's right. I 0:16:43.720 --> 0:16:47.720 think you can make a kind of you can make 0:16:48.000 --> 0:16:52.480 a an argument that, let's trust this government is taking 0:16:52.720 --> 0:16:55.360 the right gambles in with the parts that we know 0:16:55.400 --> 0:16:58.040 about right now. I think I'm trying to kind of 0:16:58.560 --> 0:17:02.000 channel this trust is kind of riskiness and radical, radical nature, 0:17:02.080 --> 0:17:04.959 you know. I think that as soon as you start 0:17:05.040 --> 0:17:09.080 to be disbanding the kind of official monitor that either way, 0:17:09.359 --> 0:17:12.240 you know, George Osborne, you know, your one time colleague 0:17:12.320 --> 0:17:15.280 brought in, I think that's the point at which you know, 0:17:15.400 --> 0:17:17.560 kind of jumps the shark, right. I think it's the 0:17:17.600 --> 0:17:20.040 point in which it goes a bit too far, which 0:17:20.119 --> 0:17:22.240 is come I mean, in terms of the scholar sacking 0:17:22.760 --> 0:17:25.080 that doesn't go too fine, as much it is. It 0:17:25.240 --> 0:17:27.959 is a massive statement, is a massive gesture. But you 0:17:28.000 --> 0:17:31.080 haven't ripped out the heart of the treasury. The treasury 0:17:31.119 --> 0:17:33.159 is still the treasury. You just it's the management of 0:17:33.160 --> 0:17:35.800 the treasury that's they're changing with the top guy. I mean, 0:17:35.840 --> 0:17:38.880 someone actually reminded when the markets were at war, right, 0:17:39.040 --> 0:17:42.280 is that through Is that the prism through which the 0:17:42.320 --> 0:17:44.760 government can do this and actually get away with it, 0:17:45.960 --> 0:17:49.320 spending spending, the spending the way out of whatever. I 0:17:49.320 --> 0:17:53.120 think she said as much. Yeah, and it's it's manifestly 0:17:53.320 --> 0:17:57.320 the case. And you have families very real, you know, 0:17:57.520 --> 0:18:00.080 having to choose between eating and eating. I think the 0:18:00.240 --> 0:18:02.640 point that people in government make is, you know, look 0:18:02.640 --> 0:18:04.800 at us compared to some of the European nations. I 0:18:04.840 --> 0:18:06.800 think we sort of in this building can fixate on 0:18:07.040 --> 0:18:09.920 versus the dollar and versus America and so on, but actually, 0:18:10.240 --> 0:18:13.240 when compared to the continent, which you know very well, 0:18:13.280 --> 0:18:17.080 you know, actually we it's not not such an unpretty picture. 0:18:18.160 --> 0:18:25.639 Thank you so much, thank you allgrat thanks, don't do 0:18:25.760 --> 0:18:29.880 that again, thank you, Phil, thank you at thank you. 0:18:31.080 --> 0:18:33.160 I was just remondered of what Golden Brown always used 0:18:33.160 --> 0:18:34.719 to say, what did he used to say, what did 0:18:34.760 --> 0:18:37.240 you ever shake his hand? And he'd say, thank you 0:18:37.280 --> 0:18:50.119 for all that you do. Thanks for listening to this 0:18:50.200 --> 0:18:52.760 week's in the City. We'll be back next week, and 0:18:52.920 --> 0:18:54.639 don't forget. If you're looking for a daily rap of 0:18:54.640 --> 0:18:56.960 the stories that matter in the UK, sign up now 0:18:57.040 --> 0:19:00.760 for our newsletter, The Read Out with acro Stratton on 0:19:00.760 --> 0:19:03.400 Bloomberg dot com Slash Newsletters, or check out the show 0:19:03.440 --> 0:19:05.800 notes for a link. And if you like what you 0:19:05.840 --> 0:19:08.919 listen to, head over to Apple Podcasts or wherever you 0:19:08.960 --> 0:19:13.359 listen to podcasts and rate, review and subscribe. This episode 0:19:13.440 --> 0:19:16.200 was hosted by me David Merritt and me Francin Laqua. 0:19:16.440 --> 0:19:19.520 It was produced by Samasadi. Special thanks to legros Stratton 0:19:19.640 --> 0:19:20.399 and Phil Aldrich.