CorpComms Magazine

Taxes on grannies, pasties and charities have spawned damning headlines in Britain's newspapers, and seem to be having an impact.

 

Just hours after a leader column appeared in The Times, arguing that the Prime Minister needed to 'fortify' the teams he employs in political communications, domestic policy and political strategy, it appeared a U-turn might be on the cards.

 

Downing Street today announced a 'full, formal consultation' on plans to cut tax relief on charitable giving.

 

James Thellusson, head of corporate affairs at Lexis, The Recommendation Agency, says: 'This is not the first time that this Government has fluffed its lines or had to do a handbrake turn on policy. And this will undermine people's confidence in David Cameron's personal brand. Given this is one of the Tory's biggest electoral assets this is a big problem.'

 

Jon McLeod, chairman, corporate communications and public affairs at Weber Shandwick, also thinks the Government's strategy could have been handled more effectively. 

 

'The communications approach for the more controversial parts of the Budget seemed to be Let's walk into a brick wall and see what it feels like,' he says.  

 

The fact that the Budget continues to dominate the news agenda is even more surprising given that many of its key provisions were leaked ahead of time.

 

But Thellusson argues that such tactics worked against the Government. 'All the good news about raising the threshold was leaked, leaving the media looking for the 'new' material,' he says.

 

'At the same time the Government failed to anticipate the scale of negative reaction from pensioners and [high street bakery chain] Greggs.'

 

This 'drip feed' approach to news dissemination also irks politicians, according to McLeod. 'The leaking ahead of the Budget caused dismay on all sides. Rather than attempting 'clever leaking' the focus should have been on stress testing the proposals by holding confidential focus groups, quantitative research, and expert opinion,' he adds.   

 

While it may have been difficult for the Government to anticipate the size of the backlash on pasty tax, taking on the charity lobby was always going to be an uphill struggle for the Government.

 

'Even though we are talking about raising a relatively trifling amount from the changes to charity tax relief [the Treasury hoped to raise between £50 and £100 million out of a total expenditure of £600 billion], trying to take on universities and charities in this way is pretty bonkers,' adds McLeod.

 

'We are talking about multiple and complex organisations across a range of sectors - all of which have very high trust levels with the public - and much more trust than the Government.'

 

Even the Conservative MP for Richmond Park, Zac Goldsmith, argued in yesterday's Daily Mail that the Government's proposals on charity tax clash with its Big Society rhetoric.

 

Richard Houghton, managing director and partner at Aspect Consulting, similarly questions Tory judgment relating to the 'pasty tax' fiasco.

 

'Good communicators provide an insight into how audiences will react and consult accordingly. Labour rejected Civil Service requests to add VAT to hot pies when they were in power because they understood what voter reaction would be. Moreover, follow-up attempts were clumsy with the Prime Minister and Chancellor pretending that pasties were part of their regular diet,' he explains.

 

'In strategic terms, the Budget has reinforced the image of the Tories as out of touch and pro rich and secondly it's beginning to undermine their reputation for competence,' adds Thellusson.

 

Presumably the Government will be hoping that the proposals on charity tax relief will be less harmful than Gordon Brown's announcement of the cut to the 10p rate of tax in 2007, which prompted claims of a 'con trick'.

 

'This announcement provoked instant fury and confusion, hurt his own constituency and became a symbol for a surprising failure in political strategy. The Government must hope Osborne's Budget doesn't become a long lasting symbol of the same,' Thellusson concludes.