Sunny money?

It was the biggest moment of Jeremy Hunt's political life. After losing the Conservative leadership election to Boris Johnson, he had been out in the cold. But when Rishi Sunak became Britain's prime minister, he made an unexpected comeback. Standing in Downing Street yesterday as chancellor of the exchequerThe chancellor of the Exchequer, often just called the chancellor, is the UK government's chief finance minister. They are in charge of taxation and government spending and borrowing. , he held up a battered red box representing the government's financial plans: the budget.

The budget is set once a year, with the government laying out what it hopes to collect in tax and how it is going to spend it. It is usually updated later in the year by an "autumn statement".

Everyone hopes that it will mean more money in their pockets. Workers and companies hope that they will pay less tax; people who receive benefits hope their allowances will be increased; public services hope for more funding. But to make everyone happy is almost impossible.

The term "budget" derives from an old French word for a small leather bag in which someone might carry money or plans. The battered red box is not believed to have anything inside it, but is traditionally held up for photographers as if it did.

Hunt gave a long speech in the House of CommonsThe democratically elected house of the UK Parliament. It consists of 650 Members of Parliament.  explaining the thinking behind the budget. Some of the key points, however, were already known.  

One was to do with childcare. The government will pay for 30 hours of free care per week for children aged nine months to five - though not until September 2025. Hunt hopes that this will encourage parents who have not been able to afford childcare to go back to work.

He also addressed energy bills. These have increased hugely as a result of Russia's invasion of Ukraine, and the government has been helping people to pay for them. Hunt announced that it would carry on doing so for an extra three months, keeping the average household's annual bill to £2,500. Duty on fuel has been frozen.

There will be less tax to pay on pension savings, with the aim of keeping people in work longer. But corporation taxA tax on the profits of a business. is being raised from 19% to 25%. Taxes on tobacco and alcohol will be increased.

Spending on defence will rise by £11bn over the next five years.

Hunt hopes that his measures will reduce the danger of a deep recessionA period of economic decline. A recession occurs when a country's Gross Domestic Product falls for six months in a row. , lower inflationAn increase in the price of goods in an economy.  and ease the cost of livingThe money that someone needs to afford basic food, housing and clothes. crisis.

But other events yesterday underlined the challenge that Hunt faces. There were strikes by teachers, university lecturers, junior doctors and London Underground drivers, all wanting pay increases.

There was some good news last month when the Bank of England forecast that any recession would be shorter and less severe than originally feared. But an article in Bloomberg on Sunday compared Britain's situation to Japan's terrible slump in the 1990s, nicknamed "the lost decade".

Britain's economic growth from 2016 to 2025 is expected to average 0.8% - even less than the 1% Japan managed. According to Bloomberg, "Dire productivity, crumbling public services and a worsening labour supply" were the backdrop to Hunt's budget.

Yes: The childcare measures will draw people back into the workforce and help solve the problem of productivity, which has been very low in recent years. Inflation is expected to fall to 2.9%.

No: According to the Institute of Fiscal studies, the childcare changes will tempt a relatively small number of mothers back to work. The pension changes will not mollifyMake someone less angry or upset. those striking for more pay.

Or... Nothing in the budget matters as much as the news yesterday that Britain is dropping import dutiesTax collected on items imported (or brought into) a country. on palm oil - whose production is devastating for the rainforest - as part of a trade deal.