Tax transparency is a political masterstroke by Osborne

The annual statements will increase support for the Chancellor’s cuts.

Like Gordon Brown before him, George Osborne is a highly political chancellor. Whenever possible, his measures are designed to meet both economic and electoral imperatives (as well as being Chancellor, he remains the Tories' chief electoral strategist).

Today's announcement that taxpayers will be given an annual breakdown of how their money is spent by the government is a particularly striking example. As the Telegraph reports, Osborne believes that the transparent statements will lead to "greater public acceptance of the need to reduce taxes and government spending". One government source is quoted as saying that "when people see how much they pay towards welfare, the argument about whether to cap benefits will be brought into sharp relief".

Osborne is likely right. Someone on £25,000 (just below the median wage of £26,000), for instance, will learn that they contribute £1,901 a year to welfare (including pensions), £363 to national debt repayment and £113 to "recreation, religion and culture". After casting their eyes over those figures, few will be inclined to hand over more of their money to the state.

But the transparent statements will also bust some of the tabloids' favourite myths. That £25K earner will also discover that he spends just £28 on the EU and £57 on overseas aid, far less than the Mail and the Express's hyperbolic headlines suggest.

All the same, it's hard not to see this as a measure that will advance the cause of small-staters. No wonder Stewart Wood, one of Ed Miliband's top advisers, has already (rightly) suggested that taxpayers should also receive a statement detailing how they benefit from public spending.

George Eaton is political editor of the New Statesman.

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Martin Sorrell: I support a second EU referendum

If the economy is not in great shape after two years, public opinion on Brexit could yet shift, says the WPP head.

On Labour’s weakness, if you take the market economy analogy, if you don’t have vigorous competitors you have a monopoly. That’s not good for prices and certainly not for competition. It breeds inefficiency, apathy, complacency, even arrogance. That applies to politics too.

A new party? Maybe, but Tom Friedman has a view that parties have outlived their purpose and with the changes that have taken place through globalisation, and will do through automation, what’s necessary is for parties not to realign but for new organisations and new structures to be developed.

Britain leaving the EU with no deal is a strong possibility. A lot of observers believe that will be the case, that it’s too complex a thing to work out within two years. To extend it beyond two years you need 27 states to approve.

The other thing one has to bear in mind is what’s going to happen to the EU over the next two years. There’s the French event to come, the German event and the possibility of an Italian event: an election or a referendum. If Le Pen was to win or if Merkel couldn’t form a government or if the Renzi and Berlusconi coalition lost out to Cinque Stelle, it might be a very different story. I think the EU could absorb a Portuguese exit or a Greek exit, or maybe even both of them exiting, I don’t think either the euro or the EU could withstand an Italian exit, which if Cinque Stelle was in control you might well see.

Whatever you think the long-term result would be, and I think the UK would grow faster inside than outside, even if Britain were to be faster outside, to get to that point is going to take a long time. The odds are there will be a period of disruption over the next two years and beyond. If we have a hard exit, which I think is the most likely outcome, it could be quite unpleasant in the short to medium term.

Personally, I do support a second referendum. Richard Branson says so, Tony Blair says so. I think the odds are diminishing all the time and with the triggering of Article 50 it will take another lurch down. But if things don’t get well over the two years, if the economy is not in great shape, maybe there will be a Brexit check at the end.

Martin Sorrell is the chairman and chief executive of WPP.

As told to George Eaton.

This article first appeared in the 30 March 2017 issue of the New Statesman, Wanted: an opposition