AMONG the rush of words that followed the Chancellor’s Autumn Statement there was one nugget worthy of particular note. It came from Damian McBride, who used to practise the inky arts of spin on behalf of his old boss, Gordon Brown, and who now earns a crust in the sunlit and virtuous uplands of journalism.
Remembering spending reviews gone by, a twinkly-eyed Mr McBride mused: “As Gordon’s spin-doctor, I used to love days like this. The media and the opposition would be baffled into submission for 24 hours, long enough for us to get through the evening news and the morning interview round, which was all we cared about.”
If such cynicism shocks you, I suggest that you, and every other three-year-old out there, put this newspaper down and get back to the story corner in the nursery where Incy Wincy spider is currently making his way up the pipe for the umpteenth time. Everyone over toddling age will surely be as familiar with the here-today, trashed-tomorrow nature of budgets as they are with the fate of Incy Wincy (worry not, kids: he lives to climb another day).
George Osborne’s combined spending review and Autumn Statement was a masterclass in misdirection. With many dazzled by his U-turn on tax credits, there was precious little attention paid to the £12 billion of welfare cuts still to go ahead, albeit in different places. As for that £27bn Mr Osborne found, all one can say is that if Britain ever tires of the National Lottery, a new game of chance is waiting. The Chancellor’s Sofa: dig deep down the back and it could be you.
Just as it has become a tradition to cheer spending statements one day and jeer them the next, so the Institute for Fiscal Studies has a set role in this political panto. Some 24 hours or so after the Chancellor sits down, it is the job of the IFS to creep up behind him and either emit a loud raspberry or whip out a bouquet of roses. Usually, it is a bit of both. It was rather more brickbats than flowers yesterday, with the IFS saying this was most definitely not, as one newspaper had declared, the end of austerity. Cuts were less severe than had been predicted, but they were still on their way. “The long-term generosity of the welfare system will be cut just as much as was ever intended,” said IFS director Paul Johnson.
Mr Osborne has had Budgets go bad on him before. Most memorably he came a cropper in 2012 over the pasty tax, charity tax and other measures. Back then, U-turns were regarded as an embarrassment, something to be avoided at all costs if a Chancellor was not to be looked on as weak or, most damaging of all, just plain wrong. Today, U-turns, like finding diamonds or £27bn down the back of the sofa, are a Chancellor’s best friend. Far from reflecting badly on the man and his methods, U-turns are now being punted as the mark of a wise politician who knows when and how to listen. Uncle George feels your pain and acts to soothe it. Who could resist such a sage?
Precious few among the Tory ranks, must be the Chancellor’s hope. Mr Osborne’s statement on Wednesday set about achieving two key aims. He had to appease those Tories who felt the cuts to tax credits were a most anti-Conservative approach to those working hard to provide for their families. In doing so, he protected his chances of succeeding David Cameron as leader. In his view, cutting tax credits had been the right thing to do earlier in the year. But fierce backbench criticism suddenly made them the wrong thing, and this most political of Chancellors was left with no option but to think again. A partial climbdown would have exposed him to the risk of more criticism, while a volte-face could be sold as a bold move, so the latter it was. Mr Osborne U-turned because he had to. When push came to shove, the man was most certainly for turning. He should not feel too bad about doing so: Mrs Thatcher, in the early days, with a slimmer majority, was a pragmatist too. It was only later, when cast-iron certainty set in, that she came to grief.
How much will the spending statement help Mr Osborne’s leadership chances? This could be his biggest gamble in what was a mini-budget packed with punts. The Chancellor was widely deemed to be “lucky” in having found all that extra money he appeared to splash around. But as any gambler knows, Lady Luck is not to be relied upon for long term wealth and happiness, never mind achieving a budget surplus by 2020. Mr Johnson of the IFS was among those pointing this out to the Chancellor yesterday. “If he is unlucky, and that's almost a 50-50 shot, he will have either to revisit these spending decisions, raise taxes, or abandon the target," he said.
A 50-50 shot. How do you like those odds, George? This time next year, or the year after, edging ever closer to the day when Dave decides he would really rather spend more time with the family, Mr Osborne might yet be grappling with the ghosts of his pre-Christmas mini-budget past. Chilling. For him, and us. It would be the worst possible foundation on which to launch a leadership bid, never mind go to the country to seek his own mandate, as any new party leader might be expected to do.
What could harm Mr Osborne in England, of course, might assist others elsewhere. One refers to a party that is having one of its worst weeks in memory. No, not Jeremy Corbyn’s Labour party. Every week is a bad week when your Shadow Chancellor thinks it is a good idea to use a mass murdering dictator as the starting point for a joke. Mao, Mr McDonnell? Wow.
No, it is the SNP, which took a pasting from Mr Osborne over falling oil prices, which could end up being the winner from this Spending Review. The Scottish Government is off the hook over reversing tax credit cuts, while Scottish Labour, having promised to do so, is left looking policy free and pointless – again. The Scottish Government could and should come under pressure over the other cuts and benefit crackdowns coming this way, but the situation is cloudier, now the clear rallying point of tax-credit reductions has gone. Now that is lucky, and not just for those who would have been at the sharp end of the cuts.
One doubts aiding the SNP was Mr Osborne’s intention, but that is the thing with new political arrangements: the old rules do not always apply. Actions can have unintended consequences. A chancellor who wants to shore up his support within a UK party might have boosted the chances of a political force that wants to take Scotland out of the UK. As a certain lady once said, it’s a funny old world.
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