Osborne, it's time for Plan B

A strategy rethink is in order.

Although the reporting cycle is a little unusual – the chancellor George Osborne only made his interim report in December – the parallels with, and potential lessons from, his private sector peers are interesting. Since he took the job (and it was a pretty senior post for a first board position) this young CFO has been struggling to explain exactly how UK Plc would achieve the more difficult half of balancing the books, i.e. growing revenues.

Somewhat predictably, the focus has therefore been on the slightly easier side of the equation, i.e. cutting costs. Thus far this approach seems to have done enough to appease watching investors and analysts. Partly due to problems being experienced by most of its major competitors, and the resulting lack of alternatives, UK Plc has been able to hang on to its investment and top credit rating. But the tough market conditions don’t appear to be easing and the outlook remains bleak. Thus Osborne, like most CFOs, will have to work extra hard to convince those watching that he has a credible plan to get UK PLC’s finances back on track.

Having already had to admit he will miss several key targets he set himself for getting the financial house in order, Osborne now needs to rethink his strategy for achieving growth. As most experienced CFOs would confirm, it is not possible to cut your way out of a slump. A sudden bout of reckless spending would be equally disastrous. But when results keep going against you (and last week’s ONS figures, showing we’re heading for a likely triple dip recession were not what Osborne projected) then it’s time to acknowledge the current strategy needs a rethink.

The rest of this article can be read on economia

Photograph: Getty Images

Richard Cree is the Editor of Economia.

Getty
Show Hide image

This is no time for a coup against a successful Labour leader

Don't blame Jeremy Corbyn for the Labour Party's crisis.

"The people who are sovereign in our party are the members," said John McDonnell this morning. As the coup against Jeremy Corbyn gains pace, the Shadow Chancellor has been talking a lot of sense. "It is time for people to come together to work in the interest of the country," he told Peston on Sunday, while emphasising that people will quickly lose trust in politics altogether if this internal squabbling continues. 

The Tory party is in complete disarray. Just days ago, the first Tory leader in 23 years to win a majority for his party was forced to resign from Government after just over a year in charge. We have some form of caretaker Government. Those who led the Brexit campaign now have no idea what to do. 

It is disappointing that a handful of Labour parliamentarians have decided to join in with the disintegration of British politics.

The Labour Party had the opportunity to keep its head while all about it lost theirs. It could have positioned itself as a credible alternative to a broken Government and a Tory party in chaos. Instead we have been left with a pathetic attempt to overturn the democratic will of the membership. 

But this has been coming for some time. In my opinion it has very little to do with the ramifications of the referendum result. Jeremy Corbyn was asked to do two things throughout the campaign: first, get Labour voters to side with Remain, and second, get young people to do the same.

Nearly seven in ten Labour supporters backed Remain. Young voters supported Remain by a 4:1 margin. This is about much more than an allegedly half-hearted referendum performance.

The Parliamentary Labour Party has failed to come to terms with Jeremy Corbyn’s emphatic victory. In September of last year he was elected with 59.5 per cent of the vote, some 170,000 ahead of his closest rival. It is a fact worth repeating. If another Labour leadership election were to be called I would expect Jeremy Corbyn to win by a similar margin.

In the recent local elections Jeremy managed to increase Labour’s share of the national vote on the 2015 general election. They said he would lose every by-election. He has won them emphatically. Time and time again Jeremy has exceeded expectation while also having to deal with an embittered wing within his own party.

This is no time for a leadership coup. I am dumbfounded by the attempt to remove Jeremy. The only thing that will come out of this attempted coup is another leadership election that Jeremy will win. Those opposed to him will then find themselves back at square one. Such moves only hurt Labour’s electoral chances. Labour could be offering an ambitious plan to the country concerning our current relationship with Europe, if opponents of Jeremy Corbyn hadn't decided to drop a nuke on the party.

This is a crisis Jeremy should take no responsibility for. The "bitterites" will try and they will fail. Corbyn may face a crisis of confidence. But it's the handful of rebel Labour MPs that have forced the party into a crisis of existence.

Liam Young is a commentator for the IndependentNew Statesman, Mirror and others.