George Osborne returns to the political fray today with a speech at Bloomberg promoting the coalition’s “pro-growth agenda” and taking aim at Labour’s “deficit deniers“.
But before he starts throwing the “denier” label around, Osborne would do well to address his own self-deception. Interviewed by Evan Davies on the Today programme this morning, he claimed that his emergency Budget was “progressive across the income distribution”.
In fact, as the Institute for Fiscal Studies has consistently demonstrated (see table), the Budget can be considered progressive only if the preannounced decisions made by Labour, such as the 50p income-tax rate (which Osborne would like to scrap), are included.
As the graph shows, if we strip out Labour’s redistributive measures it is the poorest who lose the most under Osborne’s plans. The spending cuts due to be announced in the autumn Spending Review will only worsen the situation. Contrary to Osborne’s claim that his plans are “fundamentally progressive and fair”, research by the Financial Times and others has shown that the cuts will hit the poorest hardest and create a new north-south divide.
If Osborne were to argue that the need to reduce the country’s £149bn deficit transcends all else, he would, at least, be showing some intellectual honesty. But as things stand, the Chancellor prefers deception to debate.
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