Ed's hit himself with a hammer. Why is he surprised it hurts?

Miliband is fundamentally wrong in his perception of where the centre ground is.

Ed Miliband said before he arrived in Liverpool he wanted to re-write the political rulebook. Yesterday, he succeeded.

The rules for party conference speeches go something like this. The leader arrives. It is billed either as "make or break" if they are under pressure, or "the most important speech of their life" if they are on the verge of political breakthrough. In Ed's case I think we can safely put that breakthrough stuff aside for a moment.

Prior to the great address there are mutterings of discontent. Noises off that hint at dark deeds if the becalmed or embattled leader does not deliver. Then he rises. A self deprecating joke. Thanks to the spouse. A plea to "get to work" or "down to business".

Forty minutes later the world has turned. Conference is on it's feet, the critics silenced. For one brief moment the mists clear and our troubled politician again catches a glimpse of the sunlit uplands.

If only. There are no sunny uplands on Ed Miliband's horizon today. "It was obvious he was attempting to move his party away from the territory on which Tony Blair fought elections", said the Times, "It was also the territory on which Mr Blair won elections. And Mr Miliband may have moved just a little farther from that too". "Ed Miliband's shift to the left is a gift for the Tories", said Ben Brogan in the Telegraph.

This morning Labour's leader should have been basking in the plaudits. Instead he was roaming the TV and radio studios in a desperate attempt at damage limitation. "I'm not anti-business" he said over and over. His party wasn't lurching to the left but "firmly in the middle ground of politics".

Fine. But what exactly did Ed Miliband expect? What reaction was he looking for to a speech from a Labour leader that divided the nation into "producers" and "predators", attacked '"bad" businesses and "consensus" politics, declared war on "vested interests", and announced to loud cheers he was nothing like a man who had secured three successive electoral mandates from the British people.

"I genuinely don't understand", said one shadow cabinet source this morning, "why give a speech like that and then get cross when it gets written up that way". Quite. Watching Ed Miliband today has been like watching someone pick up a hammer, hit themselves in the head and then cry out in surprise, "Oh my god, that hurt me!".

To be fair, some of Ed Miliband's supporters are realistic about the implications of the strategy they're adopting. "If you want to win an election in one term you have to take risks", one insider said yesterday, "a safety first approach just won't cut it". There is also some relief amongst his team that the 'no definition, no strategy' monkey he's been carrying around for the past year has finally been prised from his back, "I don't think Ed will be too unhappy if the interpretation is he's found direction, even if there's some criticism of what that direction is", said one source.

But there's removing a monkey from your back, and there's burning it off with a flamethrower. Yesterday Ed Miliband chose to do the latter, and the general impression of a man who has decided to march his party off to the left is toxic.

It also underlines one of the central problems of his leadership. That is that whilst Ed Miliband understands the need to occupy the middle ground of politics, he is fundamentally wrong in his perception of where it is.

If he took the time to skim through that political rulebook he is so intent on shredding he would find on page one, paragraph one the following; "During times of recession and economic hardship the electorate becomes more conservative".

When Ed Miliband says that since the glory years of New Labour the centre of gravity of British politics has shifted, he's right. But it hasn't moved towards the Labour party, but away from it.

Yes people dislike the bankers. But what they dislike was their profligacy, and their reaction is a demand for greater fiscal responsibility and prudence. People are struggling financially. Which means they have even less time for their fellow citizens who try to milk the benefits system or do their shopping through a smashed store-front window.

At times yesterday Ed Miliband tried to acknowledge that. But those nods and winks were lost within his overall narrative. People yearning for stability will not embrace a leader who tells them his leadership will involve, "taking risks". People with a longing for security will not readily turn towards someone who believes "nobody ever changed things on the basis of consensus".

Ed Miliband has decided to do things his own way; be his own man. There is, he said, nothing to be gained from, "wanting to be liked". Judging by the reaction to his speech, perhaps that's just as well.

Photo: Getty Images
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Autumn Statement 2015: George Osborne abandons his target

How will George Osborne close the deficit after his U-Turns? Answer: he won't, of course. 

“Good governments U-Turn, and U-Turn frequently.” That’s Andrew Adonis’ maxim, and George Osborne borrowed heavily from him today, delivering two big U-Turns, on tax credits and on police funding. There will be no cuts to tax credits or to the police.

The Office for Budget Responsibility estimates that, in total, the government gave away £6.2 billion next year, more than half of which is the reverse to tax credits.

Osborne claims that he will still deliver his planned £12bn reduction in welfare. But, as I’ve written before, without cutting tax credits, it’s difficult to see how you can get £12bn out of the welfare bill. Here’s the OBR’s chart of welfare spending:

The government has already promised to protect child benefit and pension spending – in fact, it actually increased pensioner spending today. So all that’s left is tax credits. If the government is not going to cut them, where’s the £12bn come from?

A bit of clever accounting today got Osborne out of his hole. The Universal Credit, once it comes in in full, will replace tax credits anyway, allowing him to describe his U-Turn as a delay, not a full retreat. But the reality – as the Treasury has admitted privately for some time – is that the Universal Credit will never be wholly implemented. The pilot schemes – one of which, in Hammersmith, I have visited myself – are little more than Potemkin set-ups. Iain Duncan Smith’s Universal Credit will never be rolled out in full. The savings from switching from tax credits to Universal Credit will never materialise.

The £12bn is smaller, too, than it was this time last week. Instead of cutting £12bn from the welfare budget by 2017-8, the government will instead cut £12bn by the end of the parliament – a much smaller task.

That’s not to say that the cuts to departmental spending and welfare will be painless – far from it. Employment Support Allowance – what used to be called incapacity benefit and severe disablement benefit – will be cut down to the level of Jobseekers’ Allowance, while the government will erect further hurdles to claimants. Cuts to departmental spending will mean a further reduction in the numbers of public sector workers.  But it will be some way short of the reductions in welfare spending required to hit Osborne’s deficit reduction timetable.

So, where’s the money coming from? The answer is nowhere. What we'll instead get is five more years of the same: increasing household debt, austerity largely concentrated on the poorest, and yet more borrowing. As the last five years proved, the Conservatives don’t need to close the deficit to be re-elected. In fact, it may be that having the need to “finish the job” as a stick to beat Labour with actually helped the Tories in May. They have neither an economic imperative nor a political one to close the deficit. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.