This Budget is about ideology as much as fiscal responsibility

It was Maggie Thatcher who stole milk from schoolchildren. Now this government will take money from

The Budget showed that, for the Conservatives, the problem facing the country is one of government rather than of the market. The Tories believe that the problem lies with the state, the size of which should be reduced, and not with the banks which collapsed.

That much is clear from how the burden of the Budget will fall: of the £40bn additional fiscal tightening being proposed, it looks as though £13bn will be achieved by raising VAT and £11bn by an attack on welfare. In contrast, £2bn is being raised by the banking levy. This reveals the priorities of this Conservative-led coalition.

The burden of the changes introduced will fall particularly heavily on the poorest and on working people more generally. The Chancellor said that he had a choice between raising income tax or VAT. About £1 of every £7 that poor people spend goes on VAT, while for the rich, the figure is about £1 in every £25. It is highly regressive and that it was increased reflects the right-wing agenda being elaborated by this government.

People have reason to fear other elements of the Budget. It was Margaret Thatcher who stole milk from schoolchildren. Now this government will take money from poorer mothers.

According to the TUC, the announcements made show that poorer mothers will lose about £1,200 a year. This may not affect the 22 millionaires sitting around the cabinet, but it can make a difference to many children and families. Whatever my differences with them, I do not believe people joined the Liberal Democrat party to attack poorer mothers, but that is what this Budget does.

It would not be my priority at this time to go for further fiscal tightening, given the fragility of the economy and the lack of demand elsewhere in the world. This view has been expressed by others, including President Barack Obama in his letter to the G20. The chief economist at KPMG, Andrew Smith, has described the Budget as a "kill or cure" plan, and went on to say:

The aim is to eliminate the structural deficit over this parliament, but it risks choking off the recovery. There is no guarantee that private demand will rebound just because the government retrenches.

Paul Krugman, the Nobel Prize-winning economist, asked how hard it could be to understand that governments can save economies rather than destroy them. Yet, as he said: "politicians seem determined to do the reverse. They're eager to short-change the economy when it needs help."

We are taking a huge risk with the future of our economy. Two million private-sector employees work for companies that are dependent on government contracts. Further damage will inevitably be done to the private sector by cuts aimed at the public sector.

When we look at the performance of the private sector, we see that it, rather than the public sector, has brought about the reduction in GDP, especially in investment. People may not like to use the word, but if there is a strike going on at the moment: an investment strike in the private sector. We can understand why it happened, but nonetheless, £6 of every £10 of the reduction in GDP is down to the decline in private-sector investment.

It is not clear to me how cuts now will suddenly lead to growth in private-sector investment. Furthermore, the Budget shows a decline in public-sector investment from £47bn in 2008-2009 to £21bn by 2014.

The underlying economic philosophy of the Budget is that, by reducing the state, the private sector will flourish. The reverse is true, as we know from J M Keynes and from what happened in the Great Depression of the 1930s. Roosevelt's New Deal rebuilt the American infrastructure and economy. The private sector was able to revive through expenditure, not cuts.

The May election gave no legitimacy for the course the government has set. Inevitably, there will be resistance both in parliament and outside. It is for the Labour Party to reflect carefully on how we respond. It will want to react responsibly, but we should place ourselves alongside people and communities who are resisting the cuts.

Jon Trickett is the Labour Party MP for Hemsworth.

Jon Trickett is the shadow minister without portfolio, Labour deputy chair and MP for Hemsworth.

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Tim Farron: We must not let racists hijack the EU referendum result

The Liberal Democrat leader says in an IPPR speech that "Britain is better" than "Farage, Le Pen and their ilk". 

Like so many people, I felt shocked and emotional about the result of the vote on 23 June.
 
I know many people who wept at the news.
 
I can understand that.​
 
Not because I love the specific institutions of the European Union, but because I feel European.
 
I also feel British. And English.
 
And northern.  And I don’t feel any conflict between those identities, in fact they reinforce each other.
 
But the result seemed to throw this balance into doubt.
 
And yes, I also felt angry.
 
I still feel angry now, but perhaps for a different reason.
 
Because never in recent history have we, in the political classes, let down the people of this country so disastrously.
 
And I make no distinction here between those who voted to Remain and those who voted to Leave.
 
They were battered with dodgy statistics. From both sides.
 
They were lied to.
 
On both sides too – though it is the NHS and the £350 million that particularly sticks in the throat.
 
And worse than that.
 
They were misled by lackadaisical politicians, playing games, who had campaigned for years to leave the EU – but hadn’t bothered to come up with a plan about what to do if it happened.
 
We, the political classes, have left a country bitterly divided as a result.
 
Between parents and children, families, neighbours.
 
Between the nations of our own union, who have worked and fought together for centuries.
 
Between us and our continental neighbours.
 
And now the biggest danger of them all.
 
That because of those divisions, we are in danger of letting malevolent forces hijack the result.
 
Plenty of my mates voted leave and I can tell you that the overwhelming majority of those who did vote leave are utterly appalled that Farage, Le Pen and their ilk now seek to claim the result as a victory for their hateful brand of intolerance, racism and insularity.  Britain is better than that.
 
But I’m not so blinded by those emotions that I don’t see the new divisions that are opening up between us.
 
New political boundaries which chop the old certainties of Tory and Labour into little pieces.
 
Because there’s a new battle emerging.
 
Between the forces of tolerant liberalism and intolerant, closed-minded nationalism.
 
And, of course, you know that, as leader of the Liberal Democrats, which side I’m on.
 
But I also know what side most people in this country are on too.
 
In the 48 per cent and also in the 52 per cent.
 
So let’s be clear about this.
 
I am absolutely committed to the cause of an open-minded, open-hearted United Kingdom.
 
United in every sense of the word.
 
Because, as Jo Cox said, we have more in common with each other in this country than what divides us. 
 
And, yes, I campaigned my heart out to stay a member of the European Union. And would do again given the chance.
 
But a nation divided against itself can’t stand.
 
Nor can it hammer out a way forward from the current impasse.
 
And our combined history cries out for some more inspiring political leadership.
 
Which can say that, in or out, we remain an open-minded, outward-looking nation.
 
Which can say, in or out, we will be European and British and from our own towns, villages and cities.
 
And be proud of all of them.
 
Which can say to those from other countries who have committed their lives alongside us in the UK: we will stand by you, no matter what.
 
Let me just say that again.
 
We will stand by you.
 
As we stood by each other across Europe in the Second World War.
 
We will stand by you, who have chosen British communities to live in.
 
Not only that but we need you.
 
If the tens of thousands of people who make it possible to run our schools and health service were to worry about our commitment to them...
 
So much so that it threatens their commitment to us...
 
It would seriously undermine services that are used by some of the most vulnerable people in this country.
 
The Conservative and Labour parties may have so forgotten themselves that they’ve missed this urgent consideration.
 
But we haven’t.
 
So I make this absolute promise.
 
To use what power we can muster, to make sure that those who have committed their lives and families to this country will be protected.
 
That no kneejerk populism will be allowed to threaten them or uproot them.
 
And I ask now all the many candidates for high positions in Westminster to join me in this undertaking.
 
I don’t just say this as the leader of a political party.
 
I don’t just commit my own party to this.
 
I speak as a Member of Parliament in one of the most open-hearted nations on earth.
 
I speak as a proud citizen of this country.
 
We will not stand by to let Nigel Farage or Marine Le Pen dictate our policy, our direction, or our morality.
 
So, yes, I campaigned to remain.  I’ll carry on campaigning to remain.
 
But we have gone beyond June’s referendum now.
 
There are more fundamental, more urgent issues that we must face today.
 
Existential issues about our nation.
 
About what they’re saying about us in the rest of the planet.
 
The newspapers.
 
The investors.
 
About protecting neighbours and friends born in other countries from hate.
 
So, yes, I recognise and understand the motivations of many of those who voted the other way to me.
 
I’m a white, working class, middle aged, northern male.  By voting remain, I pretty much confounded the predicted behaviour my demographic might suggest!  And for once it put me at odds with lots of the people I grew up with. 
 
Who are as proud as I am about the same things I’m proud of in our country.
 
I understand their fears for their own communities.
 
I completely get why being talked down to by Cameron and Osborne, threatened with a ‘punishment budget’ might push even the most internationalist person to vote leave! 
 
And nobody ever said the European Union was perfect. Least of all me.
 
Its aspiration of peace and co-operation in Europe is vitally important.
 
It still is.
 
But I’m aware that the reality of the EU can often be inflexible.
 
I understand that people’s liberal commitment to local communities, which I absolutely share, sometimes led them to vote differently to me.
 
I understand those who voted for Brexit and their frustration about the way that the big banks were allowed to torpedo the economy.
 
And torpedo so many people’s lives.
 
Without sanction. Without even a loss of bonuses.
 
While those who have tried to make a more tangible contribution their whole lives, have been sidelined, bullied and left behind.
 
I understand that, possibly better than any other leader.  Because whilst South Lakeland voted remain, it was the only place in Lancashire or Cumbria that did.  And I grew up in and I belong to the very part of British society that most heavily voted leave. 
 
And yes I understand their fears that their communities have been changed. Maybe even overwhelmed.
 
Not so much to satisfy Brussels, but specifically to reduce the wages of the big food manufacturers. 
 
Or the cleaning contractors.
 
Or the care homes.
 
Because what June’s vote did reveal, above everything else, is how angry people have become.
 
And though we might argue about the reasons for it, their anger is justified.
 
We have banking institutions that have let them down, suffocating their businesses.
 
We have an economic policy that favours the rich over everyone else, middle class, working class alike.
 
We have a housing crisis that’s consuming our children.
 
We have a Treasury so cut off from reality that they urged people not to vote for Brexit – because it might mean property prices would rise more slowly.
 
As if people weren’t struggling now to get a foot on the housing ladder.
 
To help their children scrape enough together to rent a place of their own.
 
We have people treated like cattle with zero-hour contracts.
 
We have those who worked as pillars of their community all their lives...
 
Running small businesses.
 
Managing farms...
 
Making a difference...
 
Only to see themselves gazumped by salaries ten or a hundred times as much by cash-hungry bankers in their twenties.  The devastation of our communities n the Lakes overwhelmed by excessive second home ownership is a case in point.
 
In short, we have an underlying, aching discomfort which goes to the heart of the reasons for the immediate crisis.
 
More than a discomfort.
 
It is a great and abiding fear, gnawing away at the heart of our society.
 
And we have a political class, which I don’t particularly like having to accept I’m a member of, which has abandoned people disastrously to their fate.
 
I believe that, in the national interest, we remainers and brexiters can most of us understand the motivations of voters on the other side to us.
 
We’re able to see beyond the stereotypes.
 
And to say together.
 
This open-minded nation will survive.
 
It will survive because these Liberal values are shared by so many of us. 
 
The right to say ‘this is who I am’. ‘This is who we are’.
 
And the enterprising commitment to challenge the big bureaucracies and the big businesses from below.
 
That’s why we will defend people wherever they came from originally.
 
Those who were born and bred here who are locked out of success by boneheaded cuts in adult education.
 
But also the Polish families who have work three jobs just to pay the rent, but who still help to run the school fete.
 
And the refugees who provide lynchpins to hospital after hospital from one side of the country to the other.
 
Right across the nation, and woven together, from Cornwall to Caithness.
 
Again, I say this not just as a party leader.
 
I don’t just say this to commit my party to it.
 
I say it as a proud citizen of this country.
 
With a shared history that’s always been outward-looking.
 
Connected through trade to other corners of the world in a way that no nation ever was before.
 
We provided the international language of the world.
 
We led the world in industrial development, moral development and scientific development.
 
And we stood up against tyranny even when it didn’t threaten us directly.
 
When all over Europe, those suffering under occupation, risked their lives to huddle around their wirelesses to listen to broadcasts from London.
 
There never was a moment in our history when we pulled up the drawbridge.
 
There never will be.
 
It just isn’t true that Britain voted to do that.
 
So that’s also my commitment as leader of the Liberal Democrats.
 
To listen to that fear and take it seriously. 
 
And then to hammer out and enact a more humane, more successful, more effective way of doing economics.
 
More challenging, more enterprising and more ambitious.
 
Which shares the rewards of success so that the state doesn’t have to step in so much.
 
To take on the real vested interests that hold us back as a nation.
 
The zero hour contractors.
 
The speculators.
 
The monopolists.
 
Those who would hijack people’s anger for their own racist agenda.
 
So that we can shape a fairer nation.
 
But also keep those outward-looking British values of tolerance and mutual respect that we all believe in.
 
Because there are going to be difficult, maybe dark, times ahead.
 
We’ve been made a laughing stock abroad.
 
We’ve had to watch the shaming pictures of Nigel Farage sneering on our behalf in the European Parliament.
 
We have to find a solution when both the biggest national parties have preferred to unravel than to take a lead.
 
But I’m a Liberal.
 
I believe in people.
 
And I especially believe in our people.
 
In their sense and their humanity, whether they voted to stay or to go.
 
People have been let down for decades by short-termist politicians who put the needs of one part of society above the rest.
 
Now, in the wake of the Brexit vote those divisions are more exposed than ever before.
 
With our country facing huge challenges…
 
– from inequality and injustice to an NHS in crisis and an economy in jeopardy –
 
…we are left with a reckless, divisive and uncaring Conservative Government and Labour fighting among themselves with no plan for the economy or the country.
 
That’s why the Liberal Democrats are needed more than ever.
 
We are the real voice of opposition to the Conservative Brexit Government and the only party fighting to keep Britain open, tolerant and united.
 
Britain is the most sophisticated and welcoming and innovative nation in the world and, in or out, we will stay that.
 
And we Liberal Democrats will do whatever we can, in Parliament and outside.
 
To reshape the way the nation works, to bring it back together.
 
To stay civilised. 
 
To stay united.
 
Because, wherever we were born, we love our country.​
 

Tim Farron is leader of the Liberal Democrats.