Political sketch: Chancellor runs out of places to hide

When the Speaker took the muzzle off Ed Balls, George was left eating his own words.

There were times during the Chancellor's Autumn Statement when Dave looked as if he had no idea what George was going on about and there were times when George didn't seem so sure either.

The end of the world as we know came in a speech that you could see came through teeth so gritted that ice-bound drivers would have been envious. It was all meant to be so different.

Just 12 months ago George promised that although we might have to dive into the brown stuff and swim a few lengths, we would be out of the ordure with a cup of tea and a biscuit by 2015, ready to reward him with sacks full of votes at the general election. Earlier today he revealed he had only been joking.

The day started well enough for the Chancellor but it was clearly a sign of things to come that it was deemed safer to drive the 150 yards to the House of Commons from the Treasury than face the more dangerous chance of bumping into a voter.

As he took his seat he was joined, with some apparent reluctance, by the other three members of what we now know is called the "quad", who apparently bear most responsibility for our present state of affairs.

Most embarrassed appeared to be the PM closely followed by his Deputy Nick, who usually manages to look disconnected from any of these occasions. Jammed between Nick and Dave, the Chief Secretary to the Treasury and bruiser-in-training Danny Alexander, who still looks as if he has taken the wrong turning on a school trip.

Having leaked every bit of less than disastrous news from the Statement over the past week, the Chancellor knew he had run out of places to hide. When he moved into Number 11 he had been happy to take praise for establishing the Office of Budget Responsibility to give independent views on Government policies. These were the ones who would enhance his reputation by confirming Plan A was not only the right one, but also that it was on course. But that was before he decided he had to build an extension on to it.

And so it was the OBR which did for him by confirming borrowing would be massively up -- and growth substantially down.

His own side, seeing their own prospects of re-election receding, took the view that if they shouted loud enough they could drown out the bad news. This encouraged Labour to turn up the volume even further by repeating it.

As the Chancellor's voice moved inexorably up the Richter scale his body slumped even further onto the Despatch Box and the other members of the quad adopted the embarrassed look of those on the bus when a drunk gets on.

They seemed particularly pained when George, having already warned that the good times had been out on hold, added to the general misery by announcing he was extending the retirement age to 67 from 2026, which had more than a few MPs reaching for their calculators.

And on the eve of the biggest public sector strike in years he decided to follow up his appeal to them to reconsider with the announcement that, following their present two year pay freeze, he would be restricting future pay rises to 1 per cent. At least that cheered up his side.

As George finally subsided into his seat, the Speaker took the muzzle off Ed Balls and let him at his opponent. Ed took some pleasure in sticking George's words of a year ago up where they would cause most hurt. "Britain needs a new Chancellor or a new plan", said Ed, happy to point out that the Government will now borrow billions more than Labour had planned.

Earlier in the day the opinion polls showed that despite the dire news, Labour's lead over the Tories is still just 2 per cent, and that a large slice of the public continue to blame Labour for our present predicament.

Just one certainty. All MPs will be employed until 2015.

Peter McHugh is the former Director of Programmes at GMTV and Chief Executive Officer of Quiddity Productions.

Peter McHugh is the former Director of Programmes at GMTV and Chief Executive Officer of Quiddity Productions

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Brexit is an opportunity to rethink our economic model

Our industrial strategy must lift communities out of low-wage stagnation, writes the chair of the Prime Minister's policy board. 

With the long term fallout of the great crash of 2008 becoming clearer the issue of "inclusive growth" has never been more urgent.

Eight years after the Great Crash, it is becoming clear that the long term impacts of the crisis profoundly challenges the model of economy - and politics - we have become used to. Asset inflation and technological revolutions are entrenching untold wealth for a small global elite.

This sits alongside falling relative disposable incomes for the many, and increasing difference in the disposable income of different generations. Meanwhile, a cohort of "just-about-managing" citizens are working harder than ever simply to get by, despite falling rates of savings. All of this – along with a persistent structural deficit in pensions, welfare and health budgets - combines to create an urgent need for new economic thinking about a model of growth and 21st century economic citizenship that works better for all people and places in our country.

The main political parties have set out to tackle these challenges and develop policy programmes for them. Theresa May has set out a bold new Conservative agenda of reforms to help those of our fellow citizens who are working hard but struggling to get by: to build an economy that works for everyone, and for the people and places left behind.

But this challenge is also generational, and will need thinkers from all parties - and none - to talk and think together about fresh approaches. This is why this cross-party initiative on inclusive growth is a welcome contribution to the policy debate.

The Prime Minister leads a government committed not just to deliver Brexit, but also to the fresh thinking and fresh solutions to the scale of the domestic challenges we face, which clearly contributed to the scale of the Leave vote last June. As she has said, it's clear that as well as rejecting the EU, voters were rejecting a model of growth that wasn’t working for them.

The UK’s vote to leave the European Union was one of the most dramatic and significant political events in decades – for this country and potentially for Europe. It changes everything: our economic model, our long term economic prospects, the assumptions and mechanisms through which we run most of our government and the diplomatic and economic status of the UK internationally.

Delivering a successful Brexit – one which strengthens our global security, our united kingdom, our economy and popular trust in parliamentary democracy, and a model of political economy that works to these ends, will dominate this political generation.

This is a challenge. But it is also an unprecedented opportunity to reform our model of political economy to tackle the causes of deepening domestic political disillusionment and put our country on the path to long-term recovery. 

Brexit provides us with a unique chance to address two of the most important public policy challenges facing our country.

First, the need to enable and enhance the conditions for creating and developing greater enterprise and innovation across our economy, in order to increase competitiveness and productivity. Second, the need to tackle the growing alienation of so many people and places from the opportunities of globalisation, which has in turn entrenched attitudes towards welfarism. I believe these two challenges are fundamentally linked. 

Without social mobility, and the removal of the barriers holding back national and regional participation enterprise, we will never be able to tackle the structural challenges of productivity, public service modernisation, competitiveness and innovation. 

It's becoming clearer to more and more people that a 21st century "innovation economy" both requires and drives an "opportunity society". You can't have an enterprising economy with low rates of social mobility. And the entrepreneurial spirit of economic aspiration is the fuel that powers the engine of social mobility.

For too long, we have run an economic model based on generating growing tax revenues from an ever smaller global elite, in order to pay for the welfare costs of a workforce increasingly dependent on handouts.

Whitehall has tended to treat social policy quite separately from economic policy. This siloed thinking – the Treasury and the Department for Business, Energy and Industrial Strategy for "growth" and the Department for Work and Pensions, Department of Health and Department for Education for "public services" - compounds a lack of the kind of integrated policymaking needed to tackle the socio-economic causes of low productivity. The challenges holding back the people and places we need to help do not fall neatly into Whitehall silos. 

Since 1997, successive governments have pursued a model of growth based on a booming service sector, high levels of low-cost migrant labour and housing and asset inflation. At the same time, policymakers tried to put in place framework to support long term industrial renaissance and rebalancing. The EU referendum demonstrated that this model of growth was not working for enough people. 

Our industrial strategy must be as much about lifting communities out of low-skill and low-wage stagnation as it is about driving pockets of new activity. We need Cambridge to continue to grow, but we also need to ensure that communities from Cromer to Carlisle and Caithness, which do not enjoy the benefits of being a global technology cluster, can participate too. That means new measures to spread opportunities more widely. 

The Great Crash and its aftermath - including Brexit - represents a chance for a new generation to think these problems through and tackle them. We all have a part to play. Six years ago, I set up the 2020 Conservatives Group in Parliament, as a forum for a new generation of progressive Conservative MPs, regardless of increasingly old-fashioned labels of "left" or "right", or where they stood on the Europe debate. This is a forum to discuss new ways to tackle the current problems facing our country, beyond the conventional silos of Whitehall. Drawing on previous career experiences outside of Parliament, the group also looks ahead strategically at the potential longer-term social and economic challenges that may confront us in the future.

I believe that technology, and a new zeitgeist for public sector (as well as private sector) enterprise hold the key to resolving the barriers that are currently holding back the development of new opportunities. With new approaches, better infrastructure and skills connecting opportunities with the people and places left behind, better incentives for our great innovators, and new models of mutualised public/private partnerships and ventures, we can build an economy that genuinely works for everyone.

The government has already set about making this happen. Through the industrial strategy, the £23bn package of investment in new infrastructure and innovation announced by the Chancellor, Philip Hammond, we can now be much bolder in developing a 21st century knowledge economy infrastructure that will be the foundation for economic success. 

The success of inclusive growth rests on a number of core foundations - that our economy grows, that social inequality is redressed; that people are given the skills they need to pursue a career in the new economy and that we better spread the opportunities of the global economy hitherto enjoyed by a segment of our workforce to the many. 

This can only be achieved if we recognise the way in which enterprise and opportunity are interdependent. Together, politicians from all parties have a chance to set out a new path for a Global Britain: making our country the world capital of innovation and opportunity. Not trickle-down economics, but "innovation economics" where the private and public sector commit to a programme of supporting each other for mutual benefit.

An economy that works for everyone is an economy in which the country unites around the twin pillars of opportunity and security, which are open to all. A country in which "shared values" are as important as "shareholder value". And in which both are better shared by all. A country once again with that precious alignment of economic and social purpose which is the hallmark of all great civilisations. It's a great prize.

This is an edited version of George Freeman's article for All-Party Parliamentary Group on Inclusive Growth's new "State of the Debate" report, available to download here.The APPG on Inclusive Growth's "State of the Debate" event with the OECD, World Economic Forum, RSA and IPPR is on Tuesday 21st February at 6.30pm at Parliament. See www.inclusivegrowth.co.uk for full details. 

George Freeman is the MP for Mid-Norfolk and the chair of the Prime Minister's Policy Board.