Osborne gets away with regressive VAT rise thanks to Lib Dem cover

Harman on fiery form as she lays into coalition’s first, welfare-slashing Budget.

The extent to which there is unity in the coalition was vividly demonstrated as George Osborne delivered the government's first Budget this afternoon, measured by the times at which Nick Clegg chose to nod, as he frequently did, and when he chose not to.

The Lib Dem leader looked grim-faced as the Chancellor introduced an increase in regressive VAT to 20 per cent, a policy which, as Harriet Harman reminded the House, the Lib Dems once described as a "secret VAT bombshell".

The acting Labour leader also quoted David Cameron as saying: "It's very regressive. It hits the poorest hardest."

Harman went on to ridicule the Lib Dem frontbenchers as "fig leaves" for the Tories, and turned Vince Cable's own memorable "from Stalin to Mr Bean" attack on its head by describing the Business Secretary's transformation from "national treasure to Treasury poodle". Cable smiled.

The other regressive headline from the Budget -- and again a moment when an otherwise nodding Clegg merely looked down at the floor -- came when Osborne announced, like his heroine Margaret Thatcher, that he was freezing child benefit for three years. This is a proposal pushed by Iain Duncan Smith, who has misleadingly been portrayed in recent years as a kind of reborn Robin Hood with a mission to help the "vulnerable". Progressive it was not. Nor was the abolition of the pregnancy grant.

On the other hand, an assured Osborne talked the talk of redistribution (he even referred to the Cameron-led administration as a "progressive alliance") and the widely trailed move to enhance the bracket of lowest-paid out of income tax -- a step on the way of lifting the lowest income-tax threshold to £10,000 -- was indeed designed to incentivise jobs, and goes a long way to calming any Lib Dem jitters.

But neither that, nor a new bank levy set for next year, stopped Harman laying into what she called "a Tory Budget that will throw people out of work, hold back growth and harm vital public services". She added: "This is the same old Tories." David Miliband, running for the Labour leadership, immediately described it as a " 'give with one hand, punch with the other' Budget".

Finally, the true colours of this government, especially on welfare, are beginning to be laid bare. The Labour opposition, including the leadership candidates, have their work cut out. Harman sounded genuinely pained at the Lib Dems' decision to prop up the Tories' agenda. But this is only the start. Let no one say there are no dividing lines in British politics.

James Macintyre is political correspondent for the New Statesman.
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Voters are turning against Brexit but the Lib Dems aren't benefiting

Labour's pro-Brexit stance is not preventing it from winning the support of Remainers. Will that change?

More than a year after the UK voted for Brexit, there has been little sign of buyer's remorse. The public, including around a third of Remainers, are largely of the view that the government should "get on with it".

But as real wages are squeezed (owing to the Brexit-linked inflationary spike) there are tentative signs that the mood is changing. In the event of a second referendum, an Opinium/Observer poll found, 47 per cent would vote Remain, compared to 44 per cent for Leave. Support for a repeat vote is also increasing. Forty one per cent of the public now favour a second referendum (with 48 per cent opposed), compared to 33 per cent last December. 

The Liberal Democrats have made halting Brexit their raison d'être. But as public opinion turns, there is no sign they are benefiting. Since the election, Vince Cable's party has yet to exceed single figures in the polls, scoring a lowly 6 per cent in the Opinium survey (down from 7.4 per cent at the election). 

What accounts for this disparity? After their near-extinction in 2015, the Lib Dems remain either toxic or irrelevant to many voters. Labour, by contrast, despite its pro-Brexit stance, has hoovered up Remainers (55 per cent back Jeremy Corbyn's party). 

In some cases, this reflects voters' other priorities. Remainers are prepared to support Labour on account of the party's stances on austerity, housing and education. Corbyn, meanwhile, is a eurosceptic whose internationalism and pro-migration reputation endear him to EU supporters. Other Remainers rewarded Labour MPs who voted against Article 50, rebelling against the leadership's stance. 

But the trend also partly reflects ignorance. By saying little on the subject of Brexit, Corbyn and Labour allowed Remainers to assume the best. Though there is little evidence that voters will abandon Corbyn over his EU stance, the potential exists.

For this reason, the proposal of a new party will continue to recur. By challenging Labour over Brexit, without the toxicity of Lib Dems, it would sharpen the choice before voters. Though it would not win an election, a new party could force Corbyn to soften his stance on Brexit or to offer a second referendum (mirroring Ukip's effect on the Conservatives).

The greatest problem for the project is that it lacks support where it counts: among MPs. For reasons of tribalism and strategy, there is no emergent "Gang of Four" ready to helm a new party. In the absence of a new convulsion, the UK may turn against Brexit without the anti-Brexiteers benefiting. 

George Eaton is political editor of the New Statesman.