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Osborne's 2015 Spending Review is a gamble driven by the impending popularity contest

Thursday, November 26, 2015


So what on earth was the Chancellor of the Exchequer up to yesterday? If I did not know better I would have said that the Autumn Statement was preparation for an imminent general election.

The Chancellor told us in a confident and smug performance that austerity was over, that the economy and public services were safe in his hands and that the country was on track to be the most prosperous in the formidable G7 of the richest nations on earth.

The doom and gloom merchants of political commentators, trade unions and think tanks and the entire collection of opposition parties in Parliament who were warning of huge cuts to the police budgets and forecasting starvation for families facing tax credits cuts were left speechless as Boy George delivered a Blairite budget in all its glory. The cuts were cancelled, spending on the NHS would continue to rise, the defence budget would be getting a modest increase, school budgets would be reformed and protected and foreign aid would rise to a whopping £16.5 billion a year by 2020.

So where was the radical Chancellor? Where was the solid commitment to deficit reduction and the welfare cap? Was he scared off by an imminent election? No, we have just had a general election. Was he scared off by a brooding, all powerful opposition holding him to account? No, the Labour Party are a rudderless ship without a proper Captain who could not run a bath let alone a country or an economy.

I think George missed a trick. He could have been courageous and brave and tackled once and for all the decades of wasted, bloated and unsustainable public spending that the unexpected majority secured in May gave him the opportunity to do.

Instead, he bottled it. And the reason why? It was the tory party leadership. Simple as that. He was not exposing any chink in his armour to either Boris Johnson or Theresa May. Johnson, the tory flag bearer for the protection of tax credits and May, the Home Secretary going into bat to protect police budgets in a time of unprecedented terror threats at home.  

In pursuit of his own agenda, Osborne papered over the serious cracks in the underlying state of the British economy. And whilst he could argue that the economy is in better shape than it was in May 2010, there is no dispute that our economy remains unbalanced in favour of huge debt-driven consumer spending as opposed to the creation of goods and services. Our debt continues to rise to alarming levels, adding £1.5billion each week to our national debt, which is now a staggering £550 billion higher than it was five years ago.

Our balance of payments deficit are almost as alarming as our overall debt figures. The gap between what we export as opposed to what we import will soon reach critical levels if we are not there already.

Public spending is heading towards a disaster. Protecting the NHS, pensions, welfare and schools is economic madness. All four of these areas of spending need urgent reform and a radical re-think and big reductions in their budgets.

The Chancellor made the usual noises on infrastructure but failed to tackle the real issues that are confronting us now and which if not sorted within the next year or so will damage our economy even further. No decision still on a third runway at Heathrow, this has been going on and on and on for over 15 years. The last five wacky years of flirting with Lib Dem pet environment projects such as wind, solar and wave power has left the country on the verge of serious blackouts if we do not take decisions to generate far more electricity in the next two years – nothing from George on that other than to take the dubious decision to nationalise our nuclear power industry, not into the hands of the British Government but into the hands of the Chinese Government – dodgy decision at best, madness at its worst.

It is no good the Chancellor saying I have found £27billion that I did not know that I had in July. These are forecasts of revenue that he might be getting in providing all goes well – “Events dear boy, events”. ”A week is a long time in politics” you know what I am saying George!

We needed a Chancellor yesterday who would tell the bleeding hearts on the left and anyone else that we are entitled to exactly what we can afford to pay for as a country and nothing else. It might not be what people want to hear, but this ship called UK Plc is holed beneath the economic waterline and will slowly sink if the Captain and his first mate don’t get into port soon and repair the damage.

Cameron and Osborne demonstrated yesterday that they are nothing more than centrist, liberal, political opportunists. Nothing Conservative about either of them. Thatcher would be turning in her grave and would have advised George and Dave to have grown a pair and sort the economy and public spending out – yesterday was their finest chance to do so. They had an open goal, they slipped on their own excrement as they stepped up to take the penalty and put the ball into the stands, no, out of the stadium.

I have always liked George Osborne, I have met him a couple of times and was always impressed with him. I believed he would turn out to be an effective and outstanding Chancellor. However, yesterday he failed to tell the House of Commons and the British people some hard truths that unless he or a successor imposes far more drastic cuts and reform in government spending, our children and grandchildren will inherit a debt crisis that will make today’s figures look like chicken feed.

The question we must now ask is, if the conservatives don’t feel able to strike now to sort out the economy when the opposition is in disarray, the economy is growing and they will never be as politically powerful, when will they?


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