Budget 2012: Voters won't like this Budget, but they don't trust Labour either Both the Lib Dems and the Chancellor have what a senior Clegg aide calls "red lines" and "obsessions." On Mr Clegg's passion, the £10,000 tax allowance threshold, he will be able fairly to claim that the Tories have moved further and faster at his insistence. It remains to be seen whether that move, coupled with a catch-all crackdown on the excesses of the super-rich, will be enough to placate Lib Dems furious at Mr Osborne's obsession with reducing the 50p band. While Mr Balls is astonished that David Cameron sanctioned the Chancellor's "transformational moment" of alignment with the Tory Right, Mr Clegg sees himself as a restraining force. The Lib Dems, I understand, refused to countenance the Chancellor's starting bid of 40p, insisting on a 45p minimum. Even so, the top rate cut also startled Cleggites, who recently discounted a measure likely to ensure "that all Ed Balls's Christmases came at once." Santa, it seems, has smiled on Mr Balls, who is wondering "what planet" the Coalition is living on. The difficulty is that the 50p gift has been delivered at the precise moment when some Labour luminaries are becoming openly restive about life on Planet Balls. More than one senior figure is said to have met Ed Miliband privately to air concerns about Labour's dwindling credibility on the economy. As one doubter puts the Balls conundrum: "The more the Tories have messed up, and the more Ed Balls is vindicated, the further we fall behind." That "very tense" mood is said to have spread to the shadow cabinet, with those who acknowledge Mr Balls's economic brilliance and political bullishness growing anxious about Labour's inability to shift public opinion. Some argue that with this Budget, Labour is about to miss a rare chance to set out just how it would impose fiscal discipline. In the absence of such a plan, sceptics fear that the Opposition cannot win in 2015. Mr Balls, who thinks mainstream party opinion is for more public spending, is not for turning. Despite some concessions on the "politics of pain" that Labour will have to impose, he considers that the party would appear "complete monkeys" if it had embraced Coalition-style austerity. Mr Balls remains adamant that, in this long game, voters will eventually see the folly of an economic strategy that strangles growth and stunts recovery. Mr Miliband, who is gaining admiration within his senior ranks, must hope his shadow chancellor is proved right sooner rather than later, lest Labour revert to fatal infighting while failing to win over even those at the sharp end of the Government's economic programme. The Coalition's assertion that tomorrow's Budget is a charter for fairness may bear little scrutiny. Removing tax credits will, as Yvette Cooper has argued, cost some working couples £3,800 a year; despite some attractions, Mr Clegg's rise in tax allowances will disproportionately help the better off. As Family Action and countless other organisations have pointed out, women and families will be the biggest losers. Whether they turn to Labour is another matter. Among the women to whom I have spoken, opinion is divided. Joanna is a non-working mother of twins who now relies on payday loans to meet rising prices and supplement the salary of her husband, a forklift driver. She voted Labour last time, despite its "stupid mistakes," and will do so again. Acey, a single mother bringing up three small children on £276 a week and working 16 hours, expects to be worse off after the Budget and less able to do voluntary work helping other struggling parents. Though disgusted with the Coalition, she does not trust Labour either. That view echoes back to the office where, long ago, Mr Miliband agonised for days over whether he should appoint Mr Balls, aware that such close links with the past might cement Labour's reputation, however undeserved, as the party of economic incompetence. Mr Miliband stands by the risk he took in choosing a shadow chancellor who, despite efforts to prove himself as a soufflé-cooking pragmatist, cannot yet shake off the ghost of Gordon Brown. One irony, as both Eds recognise, is that Mr Osborne is, in some ways, the real heir to Gordon. The 50p turnaround will not, in the view of Labour's smartest thinkers, be a dream moment for them. Instead they detect a Brownesque feint designed to lure the Opposition into the trap of restricting its criticism to a fairness audit. Expect Labour, which remains alert to surprises such as a move against higher-rate pension tax relief, to focus on the dearth of backing for jobs and growth. As Mr Balls put it to me yesterday: "That is the critical issue. We shall not let them off the hook on that. The two Eds will argue that, as Germany reduces unemployment and the US economy recovers, the deficit reduction strategy underpinning the Budget condemns Britain to failure. However correct that case, Labour recognises its own dilemma. To fuel growth, it must spend more. Yet within and without the party, the view persists that any intention of investing an extra penny denotes pathological profligacy. Mr Miliband is unlikely to take issue with Mr Balls, for the simple reason that he basically agrees with him. As both men know, it would make Mr Osborne's day if they were merely to castigate the unfairness of a Downton Budget. Instead, if Labour is to break free of the past, it must somehow convince voters that the Government will tomorrow usher in the age of decline ordained by George Osborne's Downturn Budget.