Will Osborne produce a credible plan for growth?

Amid the gloom, one good news story isn’t enough and the Chancellor knows it. He must act to stem th

Tuesday's ONS release provided a rare slice of good news for George Osborne. Public sector net borrowing, excluding aid to the banking sector, totalled £6.5bn last month compared to £7.7bn in October 2010, leading analysts to predict that the Chancellor will meet his target this year for net borrowing. Now is not the time to clink the champagne flutes, however.

The timing of this news is important. It follows David Cameron's disclosure on Monday that getting the finances in order is "proving harder than anyone envisaged" and comes ahead of revised forecasts from the OBR next week, which are expected to confirm what others have been saying for months: the Chancellor's plans to eliminate the current structural deficit by 2014/15 are going to have to wait an extra year, probably even two.

Whether Tuesday's data will cushion the impact of the impending blow to be delivered by the OBR remains to be seen. The Chancellor will no doubt use it to reiterate the claim that his plan is broadly on track and the country must stay the course to keep the markets at bay. But deep down, he knows he faces an even bigger problem: an economy starved of growth. As he will no doubt be reminded going into next Tuesday's Autumn Statement, GDP increased by just 0.5 per cent over the year to the third quarter of this year and it remains 4 per cent below its peak level of Q1 2008. Following in the tracks of the Bank of England, the OBR is expected to downgrade its growth forecasts for 2011 and 2012 for a fourth time.

There is no shortage of reasons that have been given to explain the current slowdown. The government would like everyone to think that it is the fault of the Eurozone crisis, despite the fact that our GDP slide started far earlier than the rumblings in Athens and Rome. But the cause of the slowdown is less important than the fact of it. If there is a role for policymakers to play in responding to fluctuations in growth then action is needed now.

Thankfully, Cameron, Clegg, Cable and Osborne have started to acknowledge this, which is why we are likely to see announcements in next week's Autumn Statement to bring forward planned capital spending and further details on how "credit easing" will be implemented. These steps are welcome, yet on their own insufficient. The package would be made worse if -- as is expected -- it includes a series of measures to curb employment rights in the view, mistakenly held by those on the right, that this will magically spur job creation in the private sector.

On Tuesday, IPPR published our top 10 ideas for how the Chancellor can revive the stagnant economy and promote sustainable and inclusive growth. Some of our proposals are concerned with the lack of demand in the economy right now, while others focus on what needs to be done to address the long-term structural weaknesses that have plagued our economic performance.

In the short-term, the priority is plain and simple: generate more growth to reverse the recent rise in unemployment and set the economy back on the path to full employment. Hence our call for the Chancellor to pledge an additional £5 billion for infrastructure spending in affordable housing and transport in 2011/12, reverse plans to cut capital allowances which will disproportionately affect manufacturers, and offer a job guarantee to every long-term unemployed young person by injecting an extra £2 billion into a ramped-up 'Green Deal'. In our view Osborne must also ensure that further fiscal tightening not only heeds to market concerns, but is also response to business and consumer confidence, and the outlook for growth.

In the medium-term, there is a need to ensure that any growth is sustainable -- taking advantage of our strengths, whilst not being dependent on a handful of bubble-prone sectors -- and that the benefits are shared broadly. To help achieve this, we propose the creation of fully-operational National Investment Bank by 2013, a revamped Export Credit Guarantee scheme to support SMEs and giving the service sector better access burgeoning overseas markets, and a rethink of immigration rules that restrict students and skilled migrants entering from outside the EU, which hampers businesses and our world-class higher education sector.

Faced with the prospect of a decade of stagnant growth, the government must now act. It must first put out the fire and then rebuild the house. This will not be a straightforward task, but it must happen. No amount of good news should distract the Chancellor from the urgent need to announce a credible and comprehensive plan for growth -- of the sort we prescribe -- this coming Tuesday.

David Nash is Research Fellow at IPPR

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The Prevent strategy needs a rethink, not a rebrand

A bad policy by any other name is still a bad policy.

Yesterday the Home Affairs Select Committee published its report on radicalization in the UK. While the focus of the coverage has been on its claim that social media companies like Facebook, Twitter and YouTube are “consciously failing” to combat the promotion of terrorism and extremism, it also reported on Prevent. The report rightly engages with criticism of Prevent, acknowledging how it has affected the Muslim community and calling for it to become more transparent:

“The concerns about Prevent amongst the communities most affected by it must be addressed. Otherwise it will continue to be viewed with suspicion by many, and by some as “toxic”… The government must be more transparent about what it is doing on the Prevent strategy, including by publicising its engagement activities, and providing updates on outcomes, through an easily accessible online portal.”

While this acknowledgement is good news, it is hard to see how real change will occur. As I have written previously, as Prevent has become more entrenched in British society, it has also become more secretive. For example, in August 2013, I lodged FOI requests to designated Prevent priority areas, asking for the most up-to-date Prevent funding information, including what projects received funding and details of any project engaging specifically with far-right extremism. I lodged almost identical requests between 2008 and 2009, all of which were successful. All but one of the 2013 requests were denied.

This denial is significant. Before the 2011 review, the Prevent strategy distributed money to help local authorities fight violent extremism and in doing so identified priority areas based solely on demographics. Any local authority with a Muslim population of at least five per cent was automatically given Prevent funding. The 2011 review pledged to end this. It further promised to expand Prevent to include far-right extremism and stop its use in community cohesion projects. Through these FOI requests I was trying to find out whether or not the 2011 pledges had been met. But with the blanket denial of information, I was left in the dark.

It is telling that the report’s concerns with Prevent are not new and have in fact been highlighted in several reports by the same Home Affairs Select Committee, as well as numerous reports by NGOs. But nothing has changed. In fact, the only change proposed by the report is to give Prevent a new name: Engage. But the problem was never the name. Prevent relies on the premise that terrorism and extremism are inherently connected with Islam, and until this is changed, it will continue to be at best counter-productive, and at worst, deeply discriminatory.

In his evidence to the committee, David Anderson, the independent ombudsman of terrorism legislation, has called for an independent review of the Prevent strategy. This would be a start. However, more is required. What is needed is a radical new approach to counter-terrorism and counter-extremism, one that targets all forms of extremism and that does not stigmatise or stereotype those affected.

Such an approach has been pioneered in the Danish town of Aarhus. Faced with increased numbers of youngsters leaving Aarhus for Syria, police officers made it clear that those who had travelled to Syria were welcome to come home, where they would receive help with going back to school, finding a place to live and whatever else was necessary for them to find their way back to Danish society.  Known as the ‘Aarhus model’, this approach focuses on inclusion, mentorship and non-criminalisation. It is the opposite of Prevent, which has from its very start framed British Muslims as a particularly deviant suspect community.

We need to change the narrative of counter-terrorism in the UK, but a narrative is not changed by a new title. Just as a rose by any other name would smell as sweet, a bad policy by any other name is still a bad policy. While the Home Affairs Select Committee concern about Prevent is welcomed, real action is needed. This will involve actually engaging with the Muslim community, listening to their concerns and not dismissing them as misunderstandings. It will require serious investigation of the damages caused by new Prevent statutory duty, something which the report does acknowledge as a concern.  Finally, real action on Prevent in particular, but extremism in general, will require developing a wide-ranging counter-extremism strategy that directly engages with far-right extremism. This has been notably absent from today’s report, even though far-right extremism is on the rise. After all, far-right extremists make up half of all counter-radicalization referrals in Yorkshire, and 30 per cent of the caseload in the east Midlands.

It will also require changing the way we think about those who are radicalized. The Aarhus model proves that such a change is possible. Radicalization is indeed a real problem, one imagines it will be even more so considering the country’s flagship counter-radicalization strategy remains problematic and ineffective. In the end, Prevent may be renamed a thousand times, but unless real effort is put in actually changing the strategy, it will remain toxic. 

Dr Maria Norris works at London School of Economics and Political Science. She tweets as @MariaWNorris.