Why the Tories are cheering Osborne's public sector job cull

The party believes that a smaller public sector will help it win a majority.

Those on the right who are fond of claiming that George Osborne's cuts are almost non-existent should look closely at the latest employment figures. They show that the coalition has cut 432,000 government jobs since the election (with an additional 196,000 reclassified as private sector posts), reducing the public sector workforce to its smallest level since 2001 (see graph). And Osborne isn't done yet. By 2017, according to the most recent OBR forecast, the government will have cut a further 298,000, bringing the total number lost to 730,000. In the words of the usually restrained Chartered Institute of Personnel and Development, we are witnessing "a tectonic shift in the underlying structure of the labour market".

What explains this dramatic cull? Fiscal considerations, naturally, play their part. Borrowing for 2012-16 will be around £174.9bn higher than originally expected (see the Bank of England's latest summary of independent forecasts) and Osborne wrongly believes that slashing the state is the best way to reduce it. In an inversion of Keynes, he thinks that if you take care of the deficit, unemployment will take care of itself (joblessness has fallen in recent months, but forecasters expect it to rise to 2.7m next year).  But Osborne, who is both Chancellor and the Conservatives’ chief electoral strategist, also has political considerations in mind. While in opposition, the Tories frequently complained that Labour's "client state" made the election of a Conservative government impossible, so, in office, they have reduced it. As one senior Tory told the Spectator’s James Forsyth, "You create a bigger private sector, you create more Tories."

The polls certainly suggest as much. Data published last month by Ipsos MORI (see graph above) showed that while Labour enjoys a 35-point lead among public sector workers, it trails the Tories by a point among their private sector counterparts (Labour leads by 39 to 35 points among the voluntary sector). Logic says that if you reduce the former group and expand the latter (the OBR forecasts an extra 1.7 million private sector workers by 2017), the Tories will benefit. A smaller public sector means fewer people with a vested interest in high levels of state spending.

The Tories aren't naïve enough to think that they'll immediately benefit from putting Labour voters on the dole, rather they believe that, over time, a labour market in which the public sector plays a smaller role will smooth their path to a majority. Osborne may claim that his cuts are born of necessity, rather than ideology, but, as ever with the Chancellor, politics is on his mind too.

George Osborne plans to cut 730,000 public sector jobs by 2017. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Lord Empey: Northern Ireland likely to be without government for a year

The former UUP leader says Gerry Adams is now in "complete control" of Sinn Fein and no longer wants to be "trapped" by the Good Friday Agreement

The death of Martin McGuinness has made a devolution settlement in Northern Ireland even more unlikely and has left Gerry Adams in "complete control" of Sinn Fein, the former Ulster Unionist leader Reg Empey has said.

In a wide-ranging interview with the New Statesman on the day of McGuinness’ death, the UUP peer claimed his absence would leave a vacuum that would allow Adams, the Sinn Fein president, to consolidate his hold over the party and dictate the trajectory of the crucial negotiations to come. Sinn Fein have since pulled out of power-sharing talks, leaving Northern Ireland facing the prospect of direct rule from Westminster or a third election in the space of a year. 

Empey, who led the UUP between and 2005 and 2010 and was briefly acting first minister in 2001, went on to suggest that, “as things stand”, Northern Ireland is unlikely to see a return to fully devolved government before the inquiry into the Renewable Heat Incentive scheme is complete -  a process which could take up to a year to complete.

“Adams is now in complete control of Sinn Fein,” he said, adding that it remained unclear whether McGuinness’ successor Michelle O’Neill would be “allowed to plough an independent furrow”. “He has no equal within the organisation. He is in total command of Sinn Fein, and that is the way it is. I think he’s even more powerful today than he was before Martin died – by virtue of there just being nobody there.”

Asked what impact the passing of McGuinness, the former deputy first minister and leader of Sinn Fein in the north, would have on the chances of a devolution settlement, Empey, a member of the UUP’s Good Friday Agreement negotiating delegation, said: “I don’t think it’ll be positive – because, for all his faults, Martin was committed to making the institutions work. I don’t think Gerry Adams is as committed.

Empey added that he believed Adams did not want to work within the constitutional framework of the Good Friday Agreement. In a rebuke to nationalist claims that neither Northern Ireland secretary James Brokenshire nor Theresa May can act as honest or neutral brokers in power-sharing negotiations given their reliance on the DUP’s eight MPs, he said: “They’re not neutral. And they’re not supposed to be neutral.

“I don’t expect a prime minister or a secretary of state to be neutral. Brokenshire isn’t sitting wearing a hat with ostrich feathers – he’s not a governor, he’s a party politician who believes in the union. The language Sinn Fein uses makes it sound like they’re running a UN mandate... Gerry can go and shout at the British government all he likes. He doesn’t want to be trapped in the constitutional framework of the Belfast Agreement. He wants to move the debate outside those parameters, and he sees Brexit as a chance to mobilise opinion in the republic, and to be seen standing up for Irish interests.”

Empey went on to suggest that Adams, who he suggested exerted a “disruptive” influence on power-sharing talks, “might very well say” Sinn Fein were “’[taking a hard line] for Martin’s memory’” and added that he had been “hypocritical” in his approach.

“He’ll use all of that,” he said. “Republicans have always used people’s deaths to move the cause forward. The hunger strikers are the obvious example. They were effectively sacrificed to build up the base and energise people. But he still has to come to terms with the rest of us.”

Empey’s frank assessment of Sinn Fein’s likely approach to negotiations will cast yet more doubt on the prospect that devolved government might be salvaged before Monday’s deadline. Though he admitted Adams had demanded nothing unionists “should die in a ditch for”, he suggested neither party was likely to cede ground. “If Sinn Fein were to back down they would get hammered,” he said. “If Foster backs down the DUP would get hammered. So I think we’ve got ourselves a catch 22: they’ve both painted themselves into their respective corners.”

In addition, Empey accused DUP leader Arlene Foster of squandering the “dream scenario” unionist parties won at last year’s assembly election with a “disastrous” campaign, but added he did not believe she would resign despite repeated Sinn Fein demands for her to do so.

 “It’s very difficult to see how she’s turned that from being at the top of Mount Everest to being under five miles of water – because that’s where she is,” he said. “She no longer controls the institutions. Martin McGuinness effectively wrote her resignation letter for her. And it’s very difficult to see a way forward. The idea that she could stand down as first minister candidate and stay on as party leader is one option. But she could’ve done that for a few weeks before Christmas and we wouldn’t be here! She’s basically taken unionism from the top to the bottom – in less than a year”.

Though Foster has expressed regret over the tone of the DUP’s much-criticised election campaign and has been widely praised for her decision to attend Martin McGuinness’ funeral yesterday, she remains unlikely to step down, despite coded invitations for her to do so from several members of her own party.

The historically poor result for unionism she oversaw has led to calls from leading loyalists for the DUP and UUP – who lost 10 and eight seats respectively – to pursue a merger or electoral alliance, which Empey dismissed outright.

“The idea that you can weld all unionists together into a solid mass under a single leadership – I would struggle to see how that would actually work in practice. Can you cooperate at a certain level? I don’t doubt that that’s possible, especially with seats here. Trying to amalgamate everybody? I remain to be convinced that that should be the case.”

Accusing the DUP of having “led unionism into a valley”, and of “lashing out”, he added: “They’ll never absorb all of our votes. They can try as hard as they like, but they’d end up with fewer than they have now.”

Patrick Maguire writes about politics and is the 2016 winner of the Anthony Howard Award.