Osborne's speech: long on politics, short on growth

The Chancellor launched attack after attack on Labour, but where was the plan for growth?

When George Osborne addressed the Conservative conference he did so as his party's chief election strategist, not as Chancellor. His speech was long on politics, but staggeringly short on growth (indeed, the word didn't appear) and jobs.

As ever, one could not fault his chutzpah. He declared that the country must not "divide one group against another" before casually demonising welfare claimants as scroungers, "sleeping off a life on benefits". He insisted that everyone had been too optimistic about growth, forgetting those economists - Paul Krugman, Robert Skidelsky, our own David Blanchflower - who warned that his obsession with austerity would tip the country back into recession. And, for the first time since he abolished the 50p tax rate on earnings over £150,000, he uttered the words "we're all in it together". In one of his many assaults on Labour, Osborne declared, "All this talk about something for something and they've learned nothing about anything", but with the country back in recession (the only G20 country, with the exception of Italy, to be so) and borrowing up by 22% so far this year, it was he who gave the appearance of having learned nothing.

Faced with a crisis of demand, the government needs to stimulate growth through tax cuts and higher infrastructure spending. It could take advantage of the ultra-low interest rates that Osborne is so fond of boasting of and borrow for an emergency stimulus. But all the Chancellor offered was a fiendishly complex new scheme allowing workers to acquire shares in their companies in exchange for giving up employment rights. In Britain, already the third most deregulated labour market in the developed world, it is not excessive regulation or "red tape" that is constraining growth. But the Chancellor, blind to the need to revive "animal spirits", still acts as if it is.

He unambiguously ruled out a "mansion tax", vowing that "this party of home ownership will have no truck with it". Yet just 3.1% of homes are worth more than £1m and the tax, as proposed by Vince Cable, would only apply to those twice this amount. In rejecting higher property taxes, Osborne has missed an opportunity to prove that he really is more concerned about "the squeezed middle" than squeezed millionaires. His priority, he said, would be to further reduce "aggressive tax avoidance", but making the rich pay taxes they're meant to be paying anyway is not the same as raising taxes on them. If the Lib Dems are to avoid further humiliation, they will need something more in return for signing up to an additional £10bn of punitive welfare cuts.

As Osborne spoke, it became clear that David Cameron had contracted out the job of attacking Ed Miliband to his Chancellor. Evidently unsettled by the Labour leader's bravura speech, Osborne declared that it was "risible" to pretend that you can become a party of "one nation" just by repeating the phrase, and that Miliband, masquerading as a centrist, was, in reality, "moving to the left". But in his refusal to adopt a more balanced deficit reduction strategy and in his defence of the wealthy, it is the Chancellor who has vacated the centre ground and his party that has relinquished any claim to be a party of "one nation". Today's speech did nothing to correct those errors.

Chancellor George Osborne delivers his speech during the second day of the annual Conservative conference in Birmingham. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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The chlorine chicken row is only the beginning – post-Brexit trade deals won't be easy

The real problem isn't the bureaucracies of the EU, but the fears of voters.

What's wrong with a little bit of chlorine in the chicken? That's the question splitting the cabinet as far as a US-UK trade deal goes. It also goes to the heart of Britain's post-Brexit dilemma.

As far as public health goes, both chicken slaughtered and sold the American way and chicken in the United Kingdom and the European Union are just as hygienic by the time they end up in supermarkets. But banning chlorine-washing means that the entire production chain, from farm to abattoir, has to be cleaner in the UK and the rest of the EU than in the States, where farmers know that no matter what happens to the chicken, that chlorine bath will absolve all manner of sins.

The EU's own research concedes that there is no public health difference. The problem, both in the rest of the bloc and the UK, is voter resistance: among French farmers and shoppers across the EU27. We all know how British people are about animal cruelty – not that they're so het up they won't actually eat them you understand – and any change that makes it easier to treat animals worse is going to be politically painful for the government.

In the long-term, changing our regulations to US standards also makes it harder to sell into the European Union. It's not a choice where you can have the best of both worlds but one where ultimately one market may preclude the freest use of the other.

And without wishing to offend any poultry farmers among our readership, this is a fairly small issue as far as the average British voter goes, even allowing for the UK's thing for animals. Just wait until things like “the NHS” start to be used in the same paragraph as the words “trade deal”.

One criticism that Brexiteers make of the EU is that it takes such a long time to strike trade deals. But the real problem isn't the bureaucracies of the EU – but the fears of voters. A cabinet clash over chicken is only going to be the beginning. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.