According to the FT, Alistair Darling’s aides are "privately calling the April 22 statement a 'Budget for jobs'". Well, nice idea, but I'm sure they'll mess it all up by (a) coming up with some expensive and ludicrously complicated scheme for the private sector, while (b) boosting public sector employment at the unavoidable expense of lost jobs in the productive part of the economy.
Of course, if the Chancellor really wanted to do a 'budget for jobs' he could do so very simply by abolishing the employers' national insurance contribution. It's a perverse tax on jobs even at the best of times, but in a recession when unemployment is skyrocketing, it's just plain stupid.
In theory, of course, the abolition of employers' NIC would be a costly tax cut in terms of lost revenue. But in practice, I doubt the Treasury would lose very much at all. By effectively cutting labour costs by 12.8 percent, getting rid of employers' NIC would save countless jobs, and correspondingly reduce the amount being paid out in benefits. It would also make British companies far more competitive internationally, and in doing so help the economy to recover.
