The Autumn Statement: Poets or rockers?

 
Hilaire Belloc and Motley Crue

In the end, it all comes down to a choice between Hilaire Belloc and Mötley Crüe. That is the choice that will determine the outcome of the next general election.

On the one side are the Conservatives and Liberal Democrats, firm disciples of Belloc and the poet's belief that one should "always keep-a-hold of nurse/ for fear of finding something worse".

Labour, for its part, prefers listening to the Mötley Crüe, particularly when the band thrashes out the lyrics: "Now it's time for change/ Nothing stays the same/ Now it's time for change".

It is through this prism that the politics of George Osborne's Autumn Statement should be viewed.

Despite everything, despite the expected poor figures, the extended austerity, the potentially missed targets, the chancellor's strategic aim will be to convince voters that everything is still on track and they should keep a-hold of Nurse Osborne's hand.

The mañana chancellor?

Let me, at this point, throw out some apparently random phrases: we are making progress; Britain is on the right track; turning back now would be a disaster; the last thing we should do now is change course.

All phrases, you will not be surprised to learn, that the chancellor himself wrote in an article for the Sun newspaper this weekend.

His challenge will be to make this case when he is simultaneously forced to admit that he is going to have to cut spending for longer to reduce the deficit and that he is not on track to meet his target of cutting national debt as a share of national income by 2015.

Quite a big task and one that Labour will insist he is unable to achieve. How can the government claim it is fixing a debt crisis when, er, debt is rising?

Cornish pasty festival Pic: Getty Images The chancellor lost ground with his "pasty tax" plan in the Budget

The big question - and one that is unanswerable for the moment - is whether the public are willing to remain patient and give Mr Osborne the extra time he is asking for. Do they continue to trust him or do they begin to view him as a "mañana chancellor", one that always promises to deliver recovery tomorrow, never today.

A key part of this argument is not just the chancellor's ability to persuade people that his deficit reduction strategy is right, but also whether they believe it is fair. Can Mr Osborne persuade people of his belief that "we are all in this together"?

This is the test that will be applied to the tax rises he is expected to levy on the wealthy, perhaps by cutting pension tax relief, and to the squeeze on welfare that he is expected to make by saying most benefits should rise by less than inflation.

In many ways, on this fairness issue, the chancellor will be trying to recover ground lost earlier in the year at the Budget. His decision to cut the top rate of tax from 50p to 45p, and the taxes that he imposed on unlikely targets such as warm pasties and static holiday caravans, made it much harder for him to argue that everyone was feeling the pain evenly.

To this end, Mr Osborne is expected to try to claim some ownership for new tax rises for the rich - not least so the Lib Dems cannot do the same.

Coalition strains

It is notable that, unlike the run-up to the Budget, there has been an outbreak of shocking coalition discipline with hardly a jot of the Autumn Statement leaked except for those parts leaked officially.

If on the Monday before a major financial statement the headline is about yet another crackdown on tax avoidance, then the Treasury is doing well.

What is the Autumn Statement?

Autumn leaves
  • One of the two major statements the Treasury has to make to Parliament every year
  • Governments decide what form they take and when to make them, so there have been many changes over the years
  • Since 1997 the main Budget - which contains the bulk of tax, benefit and duty changes - has been in the spring before the start of the tax year in April
  • The second statement has tended to focus on updated forecasts for government finances
  • Over the past few years this distinction has become blurred, with the Autumn Statement becoming more of a mini Budget
  • Under the last Labour government it was called the pre-Budget report

Where that unity between the Conservatives and Liberal Democrats will be more severely strained is when they have to say something about their plans for beyond the 2015 election.

The balance here is for the coalition to say enough for their deficit reduction plans to remain credible while keeping enough back to allow both parties to have distinctive policies that reflect their agendas and priorities in the run up to the election.

For example, in this Autumn Statement, because the Conservatives and Lib Dems cannot agree, there is unlikely to be any new mansion tax or any cut in housing benefits for the under 25s.

Expect those to appear in separate election manifestos instead. For now, the chancellor is likely to set out some more detail about a forthcoming spending review and the first year after the election - but no more.

As for Labour, the Autumn Statement provides both an opportunity and a trap. It gives the opposition a chance to capitalise on the government's poor financial figures (and missed targets), to make the case for change, to place a doubt in the minds of all those who have so far put their faith in the government.

They will argue that the government has failed on its own terms: it has failed to reduce debt. The trap is that if the government sets out its own plans to raise taxes and cut spending, then Labour will face more pressure to say what it would do. The party has yet to set out in any detail how it would cut the deficit and sooner or later it is going to have to make a decision.

So the bottom line for the Autumn Statement is a very simple question: Does it make the government more or less credible on the economy? Amid the flurry of figures and targets and pundits, that is the issue that matters.

 
James Landale Article written by James Landale James Landale Deputy political editor

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  • rate this
    -1

    Comment number 71.

    This is a comprehensively misjudged piece of twaddle.
    I think Auntie expects her editors to write too much. The huge majority of us drift through life without ever having an original thought, or even a moderately interesting one. Why does Aunrie expect her editors to be any different?

  • rate this
    -1

    Comment number 70.

    The poem that I remember goes something like:
    'A socialist is a man [sic] who has yearnings
    For equal pay from unequal earnings.
    Be he knave or fool, or both, he is willing
    To take his pound and give you his shilling.'
    Or:
    'A banker is a man who has yearnings
    For infinite pay from trivial earnings.
    Be he knave or fool, or both, he is willing
    To take all the cash and leave you a shilling'?

  • rate this
    -1

    Comment number 69.

    In my position is is obvious that this governments policies will not work because they have killed off opportunities. I had looked myself at starting a business, but now don't have the money to even be able to try. Next is to try to get some skills to work, but college courses are now hugely expensive no fee remission. Due to all opportunity having been destroyed I can only write a book...

  • rate this
    -5

    Comment number 68.

    What a load of b......., James Lansdale !
    0 out of 10 - go back to journo school asap.

  • rate this
    +15

    Comment number 67.

    The two gentlemen in this article know as much about running an economy as George Osborne and he only got the job because of his school friend having it in his gift.

  • rate this
    +3

    Comment number 66.

    Strange that our recession is down to the rest of the world, given that the rest of world has a recession nothing like as deep ours.We all know it was the bankers sub-prime lending policies in America that caused the problem. I know how disastrous these policies are personally because having been on Incap. for about 20 years I have been looking around for opportunities, and there are now none.

  • rate this
    +2

    Comment number 65.

    As much as i detest the tories we cant afford another labour goverment,the last one tried its best to destroy the working class i fear another 4 years would finish the job.Its a sorry state of affairs when UKIP the party of the hideous Hamiltons is perhaps our only hope.British politics is total and utter disgrace

  • rate this
    +7

    Comment number 64.

    No53 SeeDubya,,
    'Thatcher's barrow boys and crooks had a bit of idea'
    Can you remember the current Bullingdon louts, proud to be 'Sons of Hilda' talking about 'sharing the proceeds of growth' and solving Britain's economic problems with 'efficiency savings'?
    Little more than a bunch of liars and cheats and above all incompetents.
    They show little evidence of having ' a bit of idea'.

  • rate this
    +1

    Comment number 63.

    it was the thatcher era that ruined the country not labour ,same ole tories they take from the poorest feed it back to the filthy rich

  • rate this
    +3

    Comment number 62.

    Jim slipped Nurse and found the lion only after his friends had given him tea and cakes and jam and slices of delicious ham and chocolate with pink inside and little tricycles to ride. Who's giving us tea and cakes and jam and the rest? More like we're going without.

  • rate this
    -5

    Comment number 61.

    Typical left wing news story hype to frame the autumn statement as a clash between continuing a policy and changing a policy. All poliicies adjust over time to respond to circumstances so framing the question in this way is a trick to make any change look like a victory for the left. You journalist is either very dumb or very clever. Either way this is poor journalism.

  • rate this
    +3

    Comment number 60.

    Anybody who can remember the economy back in 97 will remember how depressed it was, exactly like now. The policies had caused terrible stagnation that caused us to drop down to about 6th in the economic league tables. The economy goes in cycles and 97 just happened to be a lucky spot for the Conservatives, had they been allowed to continue it is likely there would have been another downward spiral

  • rate this
    +10

    Comment number 59.

    George Osbourne needs to be replaced with Ozzy Osbourne.

  • rate this
    +8

    Comment number 58.

    Again and again the chancellor is targeting low and middle classes.

    He again targets income with taxes while avoiding to even tax wealth.

    So the middle classes are moved into the 40% tax while at the same time his upper classes eton colleagues can have all the wealth in the world and pay a tiny council tax.

    We are NOT all in this together..

    What are libdems doing? Have they lost the plot?

  • rate this
    -8

    Comment number 57.

    Nice to see the amnesiac left out in force today.

    The Tories have had just 3 years (in dreadful economic conditions globally) to try to repair the crumbling ecnomy, abused by Labour mismanagement for over a decade before that. We had a surplus when Labour came to power in '97.

    If Labour are elected, they will deliver an economic coup de grace to our weakened economy. Greece all over again.

  • rate this
    +8

    Comment number 56.

    There is no escaping from the damage done to this Changellor by his reduction of the 50% tax rate, before it had been properly tested. That showed exactly where his priorities lie - with himself and his arrogant, rich chums who don't know the price of milk. Trust him? I'm more likely to trust Jimmy Saville with my daughter.

  • rate this
    +8

    Comment number 55.

    No54 Colchie,
    Keep up the good work. There is no substitute for knowledge and understanding of such important matters.
    It is doubtful if you will get it from 'Pasty George', who cut his teeth in the world of capitalist finance as former treasurer of the Bullingdon Bingo Club.

  • rate this
    +9

    Comment number 54.

    @51

    Correct, we would have been better off giving every adult citizen a tax-free stimulus payment that would either have been spent (increasing demand) or would have paid off debt (recapitalising financial institutions). Q.E has destroyed savings, pensions and wages, all for the "benefit" of giving the banks money to sit on that they have no intention of lending to anybody,

  • rate this
    +5

    Comment number 53.

    The problem we now face is that the cabinet is filled with silver-spoon-in-mouthed Old-Etonians who really have no clue whatsoever about making money, that's something their grandparents did for them. At least Thatcher's barrow boys and crooks had a little bit of idea.
    Osborne's solution to domestic finance problems would just be to sack all the staff and let the house fall around his ears.

  • rate this
    +2

    Comment number 52.

    40+ Remember this hit? (New Seekers 1970 I think).. Still works!
    Hey there Georgie girl,
    there's another Georgie deep inside,
    bring out all the cash you hide,
    you can't always run things this way,
    Don't be so scared of changing,
    and rearranging, yourself,
    it's time for jumping down from the shelf,
    and you'll be a new Georgie girl,
    wake up Georgie girl!
    Hey there...( keep on 'til every hates you)

 

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