How Osborne could squeeze benefits again

No. 10 suggests benefits and pensions might not be uprated in line with latest inflation figures.

The higher-than-expected inflation numbers were bad news for George Osborne, not least because the September figures are traditionally used to determine how benefits and pensions are uprated the following April. At the Budget, the Office for Budget Responsibility predicted that CPI inflation would be 4.3 per cent but it turned out to be a whopping 5.2 per cent. As a result, as the ippr's Tony Dolphin notes, government spending on welfare will be £1.2 billion higher next year than previously thought. With government borrowing already set to be £44.4bn higher-than-expected across the parliament (thanks to lower growth and higher unemployment), this is money that Osborne can ill afford to spend.

But there's every sign that the he is prepared to change the rules. At this morning's lobby briefing (see Paul Waugh's blog for a full account), the Prime Minister's official spokesman told reporters:

The process on this is that the September figures are usually used for uprating benefits, but the final decision on that is something that happens in the autumn statement ... It is standard procedure [to use the September figure] but it is also standard procedure that the decision is taken at the pre-budget report, under the previous government, or in the autumn statement under this government.

In other words, Osborne could simply choose to use a lower set of inflation figures in order to avoid spending more. It offers him a way out but at the cost of further antagonising pensioners and others reliant on state benefits. Osborne's decision to uprate benefits in line with the Consumer Price Index rather than the (generally higher) Retail Price Index has already cost some families hundreds of pounds a year (see James Plunkett's Staggers blog on the coalition's "£11bn stealth cut").

But the Chancellor is likely to come under significant pressure from the Tory right to act. As the Telegraph's Benedict Brogan notes, economists wonder what "those whose private sector wages are not keeping up with inflation will make of seeing benefits increased by September's whacking CPI figure." But at a time when pensioners are seeing the value of their savings eroded every day by inflation, it would be a brave Chancellor who picked this moment to tighten the squeeze.

George Eaton is political editor of the New Statesman.

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The rise of the green mayor – Sadiq Khan and the politics of clean energy

At an event at Tate Modern, Sadiq Khan pledged to clean up London's act.

On Thursday night, deep in the bowls of Tate Modern’s turbine hall, London Mayor Sadiq Khan renewed his promise to make the capital a world leader in clean energy and air. Yet his focus was as much on people as power plants – in particular, the need for local authorities to lead where central governments will not.

Khan was there to introduce the screening of a new documentary, From the Ashes, about the demise of the American coal industry. As he noted, Britain continues to battle against the legacy of fossil fuels: “In London today we burn very little coal but we are facing new air pollution challenges brought about for different reasons." 

At a time when the world's leaders are struggling to keep international agreements on climate change afloat, what can mayors do? Khan has pledged to buy only hybrid and zero-emissions buses from next year, and is working towards London becoming a zero carbon city.

Khan has, of course, also gained heroic status for being a bête noire of climate-change-denier-in-chief Donald Trump. On the US president's withdrawal from the Paris Agreement, Khan quipped: “If only he had withdrawn from Twitter.” He had more favourable things to say about the former mayor of New York and climate change activist Michael Bloomberg, who Khan said hailed from “the second greatest city in the world.”

Yet behind his humour was a serious point. Local authorities are having to pick up where both countries' central governments are leaving a void – in improving our air and supporting renewable technology and jobs. Most concerning of all, perhaps, is the way that interest groups representing business are slashing away at the regulations which protect public health, and claiming it as a virtue.

In the UK, documents leaked to Greenpeace’s energy desk show that a government-backed initiative considered proposals for reducing EU rules on fire-safety on the very day of the Grenfell Tower fire. The director of this Red Tape Initiative, Nick Tyrone, told the Guardian that these proposals were rejected. Yet government attempts to water down other EU regulations, such as the energy efficiency directive, still stand.

In America, this blame-game is even more highly charged. Republicans have sworn to replace what they describe as Obama’s “war on coal” with a war on regulation. “I am taking historic steps to lift the restrictions on American energy, to reverse government intrusion, and to cancel job-killing regulations,” Trump announced in March. While he has vowed “to promote clean air and clear water,” he has almost simultaneously signed an order to unravel the Clean Water Rule.

This rhetoric is hurting the very people it claims to protect: miners. From the Ashes shows the many ways that the industry harms wider public health, from water contamination, to air pollution. It also makes a strong case that the American coal industry is in terminal decline, regardless of possibile interventions from government or carbon capture.

Charities like Bloomberg can only do so much to pick up the pieces. The foundation, which helped fund the film, now not only helps support job training programs in coal communities after the Trump administration pulled their funding, but in recent weeks it also promised $15m to UN efforts to tackle climate change – again to help cover Trump's withdrawal from Paris Agreement. “I'm a bit worried about how many cards we're going to have to keep adding to the end of the film”, joked Antha Williams, a Bloomberg representative at the screening, with gallows humour.

Hope also lies with local governments and mayors. The publication of the mayor’s own environment strategy is coming “soon”. Speaking in panel discussion after the film, his deputy mayor for environment and energy, Shirley Rodrigues, described the move to a cleaner future as "an inevitable transition".

Confronting the troubled legacies of our fossil fuel past will not be easy. "We have our own experiences here of our coal mining communities being devastated by the closure of their mines," said Khan. But clean air begins with clean politics; maintaining old ways at the price of health is not one any government must pay. 

'From The Ashes' will premiere on National Geograhpic in the United Kingdom at 9pm on Tuesday, June 27th.

India Bourke is an environment writer and editorial assistant at the New Statesman.

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