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Canny Chancellor plays his ace card to trump Miliband

IF the success of a political argument were judged on volume, then George Osborne won hands down.

The roar when he stood up in the Commons chamber and the roar when he sat down gave vent to the Conservatives' belief that the political weather is now set fair: the economy has turned a corner and will be the Tories' trump card in the battle for the next General Election.

The political body language of the last few days has been clear to see; the numbers on growth and borrowing were finally moving in the right direction.

The pre-announced bad news on the raising of the state pension age and of more departmental cuts on the eve of the Autumn Statement were able to be made because the Chancellor knew that he had an ace to play - the Office for Budget Responsibility's forecasts.

So while the French economy shrinks, the UK's rises to having the biggest current growth of any advanced economy.

There had been talk of a tax giveaway but, politically, there was no need. There are still two Budgets and another Autumn Statement to come before the 2015 Election.

Talk around Westminster is that Mr Osborne could in the next Budget signal that he might seek to raise the tax-free personal allowance beyond the £10,000 it will reach next year. He could hike it in stages with a promise that beyond the 2015 poll it will reach the magical £12,500 number, which would take out anyone on the national minimum wage.

In one blow, he would claim credit for a Liberal Democrat target and say he is putting more money in low paid pockets.

While the Tories and the Liberal Democrats place the focus on the economy, Labour, of course, seeks to emphasise how people are really feeling: squeezed.

Since the election, they say hard-working folk are £1700 worse off and the numbers show that as the Coalition austerity programme continues to grind on, wages will continue to be squeezed. The reality, Labour insists, is that people are still hurting.

But politically Ed Miliband and his colleagues have a problem. Up until now, they have been insisting the economy should have done much better and that any feelgood factor has yet to materialise.

But as we approach the next election voters will not be looking backwards but forwards. The Tories are stressing how the job is not yet done because they do not want the electorate to feel the hard times are behind it and people can again start trusting Labour with the nation's finances.

So the Coalition has come up with a canny manoeuvre.

One of the announced plans yesterday was to have an updated Charter of Budget Responsibility in spite of the fact the Chancellor has not balanced the nation's books and will not do so until towards the end of the decade.

But the key point is that the Commons will have a vote on it in a year's time as we begin the final approach to the General Election.

The purpose would be to commit the next Government to spending restraint well beyond 2015.

While Labour, which traditionally has liked to spend taxpayers' money more freely, has promised "iron discipline" and said it would stick within the Coalition's spending plans for the first year of the next parliament, there has been no binding of hands beyond that. This vote would.

It would put Mr Miliband on the spot; if he and his colleagues voted against it, they would, of course, be portrayed as fiscally irresponsible by their Coalition opponents.

"Let's see how Labour vote on that one," quipped one of Mr Osborne's smiling aides.

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