The figures in Philip Hammond’s first autumn statement yesterday confirmed that the dire economic outlook and the pinch most are feeling in the run up to Christmas is well and truly on the Conservatives. This economic mess is theirs and theirs alone.
The figures from the Office of Budget Responsibility forecasts show that Britain is likely to borrow an extra £122bn more than was estimated in the March budget and that debt as a percentage of GDP will surpass 90 per cent in 2017/18. This should put to bed once and for all the myth that the Tories are playing the part of the responsible parents tidying up after 13 years of Labour economic mismanagement.
Up until now, this myth has served them well. For the last six years Tory ministers have had it easy whenever posed with a difficult question. Cannot quite remember the justification for the latest round of cuts? Easy, it was unavoidable due to ‘the mess we inherited from the last Labour government.’ Or perhaps the budget is showing an increase in borrowing to pay off the growing national debt? There was an easy answer for that too, ‘In 2010 we didn’t know the scale of the mess we had inherited from the last Labour government, but it is far worse than we expected.’
These were the lines we heard repeated consistently, be it at the despatch box or on Question Time. That ‘mess’ is largely what won them the last two general elections. After yesterday’s autumn statement its days should be numbered. Six years and a Brexit vote later, the Tories can no longer say they did not fully grasp the scale of the structural problems of our economy. Given that a year ago George Osborne was boasting about ‘fixing the roof while the sun is shining’, perhaps they never really got it at all.
The mess is now theirs and it is Labour’s job to make sure they have to take full ownership and full responsibility for it. Not only have they had six years to bring the national debt down but the OBR have confirmed that the cost of Brexit is going to be a significant factor in the nation’s financial difficulties, a factor to the sum of £58.7bn.
When the cost of Brexit really starts to bite we cannot let the Tories forget that it is they who brought us the referendum, their senior ministers who rubbished the economic warnings, and their cabinet that is going to preside over national debt rising to 90.2 per cent of GDP. The extra public spending cuts that are heading our way are because of the economic decisions they made from 2010 and their decision to lead the UK out of the European Union to the tune of £226m a week. So much for an extra £350m a week on the National Health Service.
The chancellor’s announcements that the minimum wage will rise and upfront letting agents fees will be scrapped are of course welcome, but they are merely tinkering around the edges of the vast problems facing our economy.
Borrowing and inflation going up, growth and productivity going down. That is the story of the last six years of Conservative economic mess.
———————————
Grace Skelton is a former national secretary of Labour Students. She tweets at @graceskelton
———————————
New Labour did suck up to the City somewhat. I guess he’s just clearing up the mess.
We should have listened to Corbyn in the 80s!
Grace. Please don’t fall into the trap of offering simplistic solutions to extremely complex problems, especially about Brexit. You really won’t engage with your core supporters with more of the same dire warnings. I voted ‘remain’ but fully respect the view of others who didn’t. Do you? If so it doesn’t show in how you articulate your view. It’s not just in the UK but a significant minority – and strength is growing – throughout Europe are concerned by the Commission’s and Parliament’s direct of travel towards a federal super-state. People voted for a return of sovereignty, and most appreciate there may be a short term cost for that decision. I voted ‘remain’ – but looked for a close decision – hoping the EU and its structures would nay could change. Um …. not so certain though. And, listen to the economic strategists, the mood – especially with Trump’s ‘election’ will be towards bi-lateral rather than multilateral trade deals. The concept of the European Single Market with its mobility of labour, plus worryingly ability to move jobs to low-cost economies in the East, is unfortunately going to be consigned to the ‘dustbin of history’.
It is highly likely that Theresa May and Jeremy Corbyn are and were Brexiters and eventually the truth will be known that they both used the referendum for their own purposes. Now that the costs of Brexit are showing themselves, although anyone with any knowledge of economics would have known all the time, it will soon be seen who was swimming without their swimming costumes on. May appointed the three worst MP’s to negotiate Brexit so she cannot be surprised at the reaction of the EU negotiators. Eventually they will have to be replaced by honest people who can negotiate a compromise with the EU. Even then I would like a further referendum to be held at the same time as the 2020 general election which asked if the terms offered by the EU were acceptable. I think most people would answer No as, no matter how bad the terms are now, they are better than anything we could negotiate for leaving.
Conservative talk of the need for ‘Austerity’ was always a cover for shrinking the size of the state. Austerity was needed during the Second World War and the post-war period.It was necessary to win the war and ,as Labour said in 1945, to win the peace as well.
The Chancellor is now supposed to have admitted that ‘Austerity’ is over.If that be the case we need to ensure that the Conservatives’ fraudulent use of the term is exposed and the real reasons for their economic and social policies of the last six years revealed. It is not enough for us just to have been ‘Anti-Austerity’,we need to make the case for progressive taxation ,interventionist and enabling government ,co-operation and benign public spending.