Outlining the government’s tax and economic plans, the announcement of the UK’s annual Budget has always been a significant day for the British public and businesses in particular. It has been a source of both anticipation and contention for centuries.
Today, instead of the headlines, we’re looking into some of the most fascinating facts about the budget. We’ll trace its colourful origins, quirky history, and other peculiar trivia that may just change your perspective.
1. Budget Day Originated In the 18th Century
The budget was first developed under Sir Robert Walpole, a statesman and the first Earl of Orford. He was regarded as the first prime minister of the United Kingdom.
It was the 1720s, and his government was facing heavy criticism for the economic collapse that followed the bursting of the South Sea Company’s trade monopoly, the South Sea Bubble. Thousands of investors were bankrupt, and parliament members were exposed for corruption. The event is often cited as the first financial crash in history.
Aiming to stabilise the economy and restore public confidence, Sir Robert introduced the annual release of financial statements. This marked the official beginning of the fiscal planning for taxation and spending in the UK.
2. The First Exchequer Budget Was Prepared in 1284
While the formal budget made to the House of Commons began in the 18th century, the idea of an Exchequer dates back much farther. It wasn’t considered an official office at first—more an occasion when the King’s officials gather to discuss the country’s finances and ensure all coins are accounted for.
The first ever Exchequer was recorded in 1284, during the reign of Edward I. The rather unusual word “Exchequer” was derived from the checkered cloth on which powerful Barons and their unfortunate accountants tallied the Crown’s finances.
Ironically, the first national budget didn’t balance, and instead exposed the crown’s lavish spending habits. This was immediately followed by rapid tax hikes to cover the deficit.
3.“Little Bag”
The annual government spending averages in the billions, but you may be surprised at what the word “budget” really means.
Originating from the French word bougette, budget literally translates to “little bag.” Some claim that this playful naming was inspired by the previous custom of using leather bags to carry the yearly financial statement speech.
4. Iconic Red Box Tradition
As you may well know, the leather bag has been replaced by the distinctive Budget box. It was replaced in 1860, when Prime Minister William Gladstone used a handcrafted despatch box.
Gladstone’s famous briefcase remained in use consecutively for one hundred years. The tradition was only ever broken twice, first by James Callaghan in 1965 and by Gordon Brown in 1997.
Lord Callagan instead used a brown valise, one which the chancellor’s critics were quick to label as “vulgar.” The former chancellor reportedly claimed that the original Budget box was too small for its purpose.
After Callaghan’s term, Gladstone’s red briefcase was brought back into use. That’s until Gordon Brown personally requested the change and commissioned and used a new case throughout his time in office.
In 2007, the first Budget box was brought out of commission by the then-Chancellor Alistair Darling. And again in 2010, when George Osborne used Gladstone’s box for his first budget speech.
Now, the national treasure was officially retired from its service due to its fragility. It now sits safely at the Cabinet War Rooms in London.
5. A Forgetful Chancellor
On Budget Day, it’s customary for chancellors to hold up the red case before leaving 11 Downing Street, the official house of residence for the Chancellor of the Exchequer, to present their speech.
Amusingly, this bizarre little tradition may have something to do with an unfortunate mishap that happened over a century ago.
In 1868, on Budget Day, Chancellor George Ward-Hunt was on his way to the House of Commons. Only, he forgot something important to put into the red box: his budget speech.
Hunt reportedly left his report at home, delaying the parliament for a while. Embarrassed, the chancellor would then proceed to deliver one of the briefest budget speeches.
Yet, Hunt’s unceremonious display was far from being the only blunder that occurred in the office’s long history. Norman Lamont was the UK’s Chancellor of the Exchequer between 1990 and 1993. While he didn’t forget anything, Lamont allegedly carried a bottle of whisky in his Budget box and stashed his speech in a plastic bag.
6. The Booze Exemption
When you think of booze, you usually picture bustling bars and tipsy drinkers. But what if I told you that tradition permits chancellors to wash their speeches down with booze—yes, even up on the floor of the House of Commons.
On any other day, drinking alcohol within the House of Commons chamber is strictly forbidden. However, during Budget Day, a special parliamentary rule dictates that chancellors may drink whatever they wish while delivering their speech.
The privilege is specific to the Chancellor of the Exchequer and is solely in the context of delivering the budget.
What’s even more curious is how historians and academics fail to pinpoint where this rule comes from, much less when it started.
As was to be expected, many of Britain’s chancellors had booze as their poison of choice. Former Chancellor Kenneth Clarke swigged whisky, before him, Nigel Lawson, downed wine, while Labour Chancellor Hugh Dalton chugged rum.
More recently, the current Chancellor, Reeves, made news for opting for a plain cup of water. Still, this “switch to sobriety” has been going on since the 1990s, when Gordon Brown first departed from the age-old custom.
7. The First Woman Budget Chancellor
Chancellors have been a thing for over 1,000 years—all men. In an interview in 1997, the former Chancellor Dennis Healey famously said, and I quote: “Being Chancellor is not a woman’s job.” This was when third-wave feminism was just taking root in the UK.
Two decades later, Reeves was appointed and became the first ever woman to hold the Exchequer office, taking her place beside Churchill, Gladstone, and Cromwell.
Rachel Reeves is an MP for Leeds West and Pudsey. She was born in February 1979 and grew up in Lewisham.
8. Gladstone’s Marathon Speech
Most chancellors keep their financial statement speech brief and concise. But for those MPs present when William Gladstone was Chancellor, they’d sometime have to endure Budget speeches for hours on end.
Gladstone was notorious for his lengthy Budget Day reports. One of his longest continuous Budget speeches was in April 1853, which ran nearly five hours, when he famously proposed abolishing certain customs duties, as well as reducing and prolonging income tax.
Only Benjamin Disraeli’s five-hour Budget (with breaks) in 1867 came close to Gladstone’s record time. Gladstone also holds the distinction of delivering the most Budget speeches in the UK’s history.
9. The Most Controversial Budget
To “wage implacable warfare against poverty and squalidness,” Chancellor David Lloyd George’s 1909 “People’s Budget” is remembered as one of the most controversial budgets in the country.
Alongside Winston Churchill, Lloyd George put forward proposals that stirred widespread backlash, including an unprecedented tax increase for Britain’s wealthy landowners.
The House of Lords, which was then primarily composed of Conservative aristocrats, rejected Lloyd George’s sentiments. The historic event would later prompt the removal of the Lord’s veto.
Bottom Line
Over centuries, the Budget has evolved from tallying coins to becoming a key cornerstone of the UK’s economy. But as unease and anticipation increase with the countdown to the autumn budget, revisiting these tidbits of history may offer a fresh lens to appreciate its significance.
Image credit HM Treasury
