Since his arrival at the Treasury, John Healey has talked of giving the economy ‘breathing space’ after the hyperactivity of his predecessor’s time in No11.

The Rachel Reeves Budget of last November scored 88 policy and tax changes on top of 70 the year before. 

That left businesses, consumers, HMRC, and civil servants responsible for administering changes with fierce policy indigestion.

Remarkably, while Europe’s other big economies, Germany, France and Italy, are stagnating, Britain is growing at a 1.3 per cent clip. 

This begs the question of why Prime Minister Andy Burnham is anxious to get closer to the European Union.

Being out of the EU encouraged British firms to broaden horizons and look towards the fast-expanding Pacific Basin and North America.

Goldman Sachs’ estimate that closer ties to the EU could add 1pc to output looks tempting. Economics tells us that trading with your closest neighbours is most efficient. 

But as Canada is learning, when your neighbour is unfriendly and as distrustful as Donald Trump’s America, it is time to look elsewhere. Healey’s Budget is intended to allow the country to come up for air. 

We can expect more feel-good nudges of the kind we have seen since Burnham arrived at No10.

It will be a terrible error if Healey banks the kinder fiscal words from the IMF and Britain’s growth upgrade and opts for former Royal Navy lieutenant James Callaghan’s ‘steady as she goes’ Budget strategy of April 1967.

Shocks battered Callaghan’s complacency including the Six-Day War, the closure of the Suez Canal and a dockworkers’ strike. 

The seas became heavy. Callaghan and his boss Harold Wilson devalued the pound by 14 per cent that November and the Chancellor resigned. Britain’s economy may appear to be doing fine. But the challenges of 2026 are as daunting.

Saudi Arabia is in near lockdown as it confronts Yemen’s Iran-backed Houthi rebels. The White House is in the hands of an unreliable ally, as Ukraine has learned. 

France has fiscal problems that make the UK’s almost bearable. And Germany’s powerhouse engineering economy is spluttering as China robs its domination of mass car markets.

Protecting Britain from negative forces ought to be the focus today. If Healey is to avoid a Callaghan or Truss-style meltdown on currency and bond markets, he should take the opportunity to slash the size of the state.

At the very least, freeze public sector pay and government benefits. Relying on the headroom created by Reeves’ baked-in-the-cake tax increases and unidentified spending cuts is not prudent.

Banking gains

HSBC finds it hard to please everyone. Booming profits at Britain’s only mega-bank will doubtless be used by earnings haters as justification for the expected jump in windfall taxes in today’s Budget.

Investors were less impressed, hoping for a stronger performance and bigger rewards via share buybacks. A 32 per cent rise in pre-tax profits to £7.2billion in the third quarter should have shareholders dancing in the street. 

Yet it was at the lower end of expectations in a rising interest rate world that should strengthen margins.

There is another way of looking at HSBC’s performance. It is becoming a simpler bank by disposing of marginal enterprises, such as Allianz in Singapore, and becoming more closely focused on its core markets. 

A higher bank tax doesn’t help and may partly explain the 5.4  share per cent price tumble. Nevertheless, the stock is up almost 30 per cent in the past year.

Better that HSBC strengthens its capital and builds a war chest for the geopolitical and AI horrors ahead.

Ice cream wars

Ben & Jerry’s is a sumptuous luxury ice cream brand. The political correctness that comes with it is a perpetual shadow.

Unilever spared itself further disruption when it spun off its Magnum ice cream brands in Amsterdam in late 2025.

They should have thought about that when they sold B&J for £245million more than a quarter of a century ago.