Lib Dem MPs speak out against Osborne’s extra £4bn benefit cuts

Chancellor faces backlash from backbenchers after criticising those who see welfare as a “lifestyle

Left-wing Liberal Democrat MPs have expressed outrage after the Chancellor, George Osborne, told the BBC that he planned an additional £4bn cuts to benefits. Coupled with the £11bn already announced, this amounts to a cut of 6 per cent of the total welfare budget.

In a remarkable attack on the current system of benefits -- and many of the people on them -- Osborne said:

The welfare system is broken. We have to accept that the welfare bill has got completely out of control and that there are five million people living on permanent out-of-work benefits. That is a tragedy for them and fiscally unsustainable for us as a country. We can't afford it any more.

Of course, people who are disabled, people who are vulnerable, people who need protection will get our protection, and more.

But people who think it's a lifestyle choice to just sit on out-of-work benefits -- that lifestyle choice is going to come to an end. The money won't be there.

It was a marked contrast to Nick Clegg's muted tone earlier in the day, when he said that tough decisions were necessary, but that these cuts were not "dramatically different" from those planned by Labour.

Three Lib Dem backbenchers have so far expressed their anger, taking issue as much with the aggressive tone of Osborne's remarks as with the further cuts.

Bob Russell, MP for Colchester, has tabled an urgent question on the extra cuts. He told the Today programme:

Yes, let's deal with the welfare cheats. But the notion that they are responsible for all the ills of the nation is in fact a smokescreen and it's not very ethical.

Two other Lib Dems, Mike Hancock and Tim Farron, also pledged to vote against the cuts. Hancock told the Guardian:

This goes right to the heart of the benefit system in this country. He has a lot of questions to answer and this is not the right way to do things.

Farron also spoke out, saying:

The government needs to demonstrate that those who got us into this mess are going to more than bear the brunt and that the most in need will not be targeted. We need to scrutinise where the cuts are made.

It's not just Lib Dems who will be disgruntled by Osborne's remarks, either. The Work and Pensions Secretary, Iain Duncan Smith, is engaged in sensitive negotiations with the Treasury over his proposals to spend more money initially to reform the welfare system and create more work incentives.

Osborne's grandstanding rhetoric -- which stopped just short of talking about "benefit cheats" -- helps no one.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.