Another Osborne omnishambles?

25 November 2015
By Joy Johnson

Osborne went to parliament to attempt to undo the damage his last budget did to his political fortunes. Time will tell if he has managed it.

Tax credit cuts that would have hit 3.3 million low income families who would have lost an average of £1,000 a year – the reason for the force of opposition his policy was met with. By any standards this is a massive climbdown forced on him by the work of the Labour leadership and Labour lords.

There will undoubtedly be some devil in the detail on where the £4.4bn is going to come from that will trickle out in the next few days.

History tells us that we need to watch for any sleight of hand. Who is losing? As the shadow secretary of state for work and pensions Owen Smith warns, low-income households on Universal Credit are still vulnerable. When the full implications of those cuts come to light - the lesson has to be from the tax credits debacle that opposition can force a U-turn.

Pensions up, more money for health, more money for infrastructure Osborne the builder had his list for more roads and more rails and even a permanent pot hole fund. Every year since 2010 Osborne has trotted out infrastructure projects, expecting previous deep cuts to infrastructure investment to be forgotten. The doubling of the housing budget now comes after a 60 per cent cut before.

He may sound masterful but let’s remember that budget statements that win cheers on the day begin to unravel the next.

There are cuts to already beleaguered local government services, public health budgets and grants to train nurses are being converted to loans - amongst many other details that can often be lost in the immediate melee of Osborne’s speeches.

While he appears to be turning a political iron law that U Turns are a calamity into a personal triumph the need to be vigilant remains as important as ever. Make no mistake there will be hidden cuts that have never been presented to parliament.

There was a further climbdown by the chancellor and this was on police numbers. In the run up to the Autumn Statement there was much talk of major cuts in spending. Yet again Labour along with former Metropolitan commissioner, Sir Ian Blair and the current commissioner, Bernard Hogan-Howe warned that cuts would harm his ability to fight terrorism on the streets of London.

During prime ministers question time just before the statement was delivered Emily Thornberry MP read out the names of young people murdered in the city by knife crime and warned of the danger of any cuts in spending.

Before the Autumn Statement, Paul Johnson of the Institute for Fiscal Studies said that “We’ve never had anything like it [the proposed cuts]. The size of the state overall will be roughly where it was at the end of the 1990s, which was a historic low for the post-war period … it’s going to be difficult, and it will be more difficult than it was over the last parliament. For one thing, clearly if there were relatively easy cuts to make they will have been made already.”

John McDonnell in his response said that there were people who thought Osborne and Cameron were involved in some sort of Machiavellian plot to shrink the state – he was one of them – but now he doesn’t believe that. ‘The truth is that they were economically illiterate’.

MPs on the Tory benches had to be told by the speaker to quieten down a number of times. Their barracking of the shadow chancellor shows one thing above all and that is how scared they are of his effectiveness. They do not want to be drawn into a battle on the impact austerity is having on people’s quality of life and the security of their homes and jobs.

When going through the documentation, hidden in the text and, we suspect deliberately unclear, we see that funding for opposition parties is to be reduced by 19 per cent. This funding is known as ‘short’ money and is earmarked for the vital constitutional task, within our parliamentary democracy for opposition parties to hold the government to account (see Short money slashed).

This spiteful measure coming on top of the Trade Union bill is yet another demonstration of this government’s determination to silence any opposition.