Morning Call: the pick of the papers

The ten must-read comment pieces from this morning's papers.

1. A third runway, Boris Island, better rail? Please, just decide (Guardian)

Prevarication over aviation policy breeds a dangerous mistrust. The cabinet must take a firm decision, and act on it, writes Jackie Ashley.

2. The German people will decide Europe's fate (Guardian)

Hans Kundnani argues that starkly divided opinion in the EU's biggest economy could be as big a threat to the euro as Greek debt.

3. Will the real David Cameron please stand up? (Times £)

The Prime Minister must stop calculating which way is safest to jump and get out and fight for what he believes, writes Conservative Home's editor Tim Montgomerie.

4. David Cameron praises Paralympians, but his policies will crush them (Independent)

With just days to go until the Paralympics start, the Government still intends to drive 500,000 people off the Disability Living Allowance, writes Owen Jones.

5. The elephant in the room: Romney the pragmatist (Financial Times)

Romney's trademark used to be pragmatism and competency. So how will he survive yoked to the modern-day Republican party, asks Edward Luce.

6. We need much simpler rules to rein in the banks (Financial Times)

Rather than creating complex sets of regulations, banking authorities should focus on naming and enforcing a "bright line" which it is clear that banks should not cross, writes Nicholas Brady.

7. What GCSE English needs is more red ink (Times £)

Libby Purves writes that letting students make errors in spelling, grammar and punctuation is far crueller than altering their grades.

8. I have a confession to make – I go to church (Independent)

Andrew Martin applauds a new report that says religion makes people happier, denies that religion is irrational, and wonders why his friends are so resistant to it.

9. The Thick of It: the agony of tight spaces (Guardian)

Crises come and go but one thing never changes in this show – the politicians are stuck, with no room for manoeuvre, says Ian Martin, one of the show's writers.

10. Terrorists seek a safe haven in Strasbourg (Telegraph)

The Telegraph editorialises against the European Court of Human Rights' "interference" – it is proceeding with an appeal by two British terrorists.

Photo: Getty Images
Show Hide image

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.