The chancellor’s Autumn Statement and public sector strikes provided the political backdrop to events inside and out of parliament this week. On Tuesday, George Osborne appeared in front of a packed Commons chamber and produced what was effectively a ‘mini-budget’ which contained a very grim outlook for our economy. Gone were his bold statements about Britain ‘being out of the danger zone’ or how we can be ‘cautiously optimistic’ about economic recovery. Instead, we got a chancellor who was forced to admit the realities we face.
Borrowing is set to spiral by £158billion, dashing the government’s hopes to meet the deficit reduction target that it set itself only 18 months ago. Growth has been slashed to 0.9 per cent this year, down from 1.7 per cent forecast in March, and 0.7 per cent next year, down from 2.5 per cent – the forth downgrade since the Tory-led government came to power. And unemployment will continue to rise for the next two years according to the OBR.
Meanwhile, the government’s squeeze on living standards is going to be not only severe but prolonged, extending to six years or longer, a situation not seen in the UK for 60 years.
1.3 Billion a year will be snatched from children and families after further cuts to Child Tax Credit and the freezing of the Working Tax Credit, while the bankers are again let of the hook.
The grim economic forecasts did not stop the government from leaking most of the Autumn Statement over the weekend. But despite all of the spin in advance of Tuesday, the measures the chancellor chose to highlight in his leaks unravelled under close scrutiny.
In Labour’s response, Ed Balls attacked the government’s record. He said their economic Plan A had failed and it was time for them to adopt Labour’s five point plan that puts jobs and growth first.
Up to two million people took part in the largest industrial action Britain has seen for a generation on Wednesday. Nobody wanted a strike to take place and we called on the government to engage in meaningful negotiations with trade unions to avoid it. Many thousands of hard-working people, who have never before been involved in such action took part and at PMQs on Wednesday Ed Miliband put in a strong and passionate performance and accused the prime minster of ‘spoiling for a fight’ with the unions.
The prime minister’s response was complacent and I think it was a mistake for him to dismiss the grievance felt by dinnerladies, cleaners and nurses and the many other public sector workers.
In my absence at Business Questions on Thursday, shadow deputy leader of the House, Angela Smith questioned the government on its legislative agenda. For sometime now we have seen a distinct absence of government sponsored business. Angela accused the government of going into ‘hibernation’ and pointed out that after just 18 months in government, they have run out of ideas while their economic policy has run into the sand.