The devil could be in the detail, but the bigger picture is still bright for the Chancellorby Ryan Shorthouse / November 26, 2015 / Leave a comment
They call him Octopus Osborne. For his tentacles reach into other government departments, his protégées in key positions across Whitehall. Yesterday, in the Autumn Statement, we also saw the Chancellor sprawl across a vast public policy space. There was something for mental health, roads, science, childcare, women’s charities, museums, even tax credit claimants. Something for everyone. All in it together.
Clever politics indeed. Nearly all the bases are covered, muting critics and quashing Labour leads. Jeremy Corbyn, upon becoming Leader of the Opposition, showed that one of his key and unique priorities would be mental health, appointing a new Shadow Cabinet level Minister for Mental Health. Well, yesterday, the Chancellor announced an extra £600m for mental health services.
Déjà vu. Ed Miliband wanted a higher minimum wage of £8 per hour by 2020. So Osborne went on to promise the “National Living Wage,” at £9 per hour. At the last election, Labour wanted to make companies train an apprentice for every foreigner they hired. Yesterday, the Chancellor announced a 0.5 per cent “apprenticeship levy” on the wage bill of large employers.
Octopus Osborne can change colour. Small state crusader one moment, all taxes and targeted subsidies another. Tough talk on the economy sometimes. Other times, progressive pronouncements on ending global poverty or supporting the arts. Nearly all policy areas and mechanisms are embraced. It’s hard to pin him down—his ideology, his temperament, his priorities. Just when you thought he was going to stubbornly persist with cutting tax credits, he retreats. The rumour was that there would be cuts to the police and to Further Education. Neither happened. He loves to surprise. The opposition, meanwhile, are now finding it difficult to paint a convincing picture of him, to convey to the public a flawed personality or approach that sticks.
The Autumn Statement reaffirmed Osborne as a master tactician and a policy pragmatist. Judge him not on grand words or ideas, but delivery. And he has a good story, in general, to tell. The economy continues to grow, faster than most other OECD countries. Employment, especially female and youth employment, is at record levels. Wages are rising as inflation remains low. The deficit, slowly but surely, is being reduced.
But economic competence is not enough for this ambitious Chancellor. He wants, in this second term of Conservative Government, to steal Labour’s clothes as the party of social betterment too. “The other side talks of social justice, this side delivers it,” he said, triumphantly declaring higher educational standards, lower crime rates and higher satisfaction with local public services.
The proof will be in the pudding. Five years from now, we’ll be able to assess overall whether this really is “a progressive Government in action”. In many areas, the direction of travel is encouraging: the details might need sorting though.
The retreat on the cutting of tax credits, for example, is very welcome—low paid workers certainly did not deserve the cuts to their income originally envisaged. But the support available for future tax credit claimants through Universal Credit will be reduced and needs reconsidering.
Likewise, the extension of tuition fee loans to a wider range of higher education students—to older postgraduates and those taking equivalent or lower qualifications in all Science, Technology, Engineering and Mathematics (STEM) subjects—is welcome. The direction of travel is clear: more and more higher education students receiving financial support through government-backed loans, including now student nurses. Really though, the Government ought to have prioritised extending coverage of tuition fee loans to more people—all part-time students and those taking any type of equivalent or lower qualification—rather than enabling part-time students to access maintenance loans. It is the cost of tuition more than the cost of living which is a bigger barrier to part-time study, as Bright Blue’s recent research has shown.
Finally, on childcare: considering the ongoing fiscal constraints, the Government is investing an impressive amount in making childcare affordable. However, the real priority for childcare now is to boost quality to significantly enhance educational standards. It would be better if the Government used the money for extending the early years free entitlement for all 3 and 4 year olds to 30 hours a week from the current 15 hours a week to improve quality instead. Then we can get close to building a pre-school education, which all children should attend, that dramatically improves life chances in the UK.
These debates over detail are important. But the bigger picture is bright for Osborne, especially with such a weak opposition.