How the Autumn Statement hit "the strivers"

Sixty per cent of welfare cuts made in this parliament will fall on the working poor.

For a Chancellor who prefaced his Autumn Statement with a declaration that he was "on the side of these who want to work hard and get on", George Osborne has made some rather inconsistent announcements yesterday.

Consider, for example, his decision to uprate tax credits at below-inflation levels for the next three years. Both working couples and lone parents look set to lose over £23 of their working tax credit (WTC) in 2013-14 as a result of this move. Not so bad, one might think, but remember that this comes on top of a prior freeze in value of other key elements of WTC which will remain in place, and which will shave an additional £60 off a working family’s entitlement next year.

The changes being made to the personal tax allowance will do little to offset this shortfall. Extending the threshold potentially leaves basic rate taxpayers £47 better off in 2013-14. But for low-income working families, much of this gain evaporates as other forms of support are tapered away in response to their higher post-tax income. While those further up the income scale will keep the full £47, a working family eligible for both housing and council tax benefit will gain only 13p a week extra as a result of extended allowances.

Osborne is fond of the notion that there is a group of hard working "strivers" out there who throw "those with their blinds down" into sharp relief. In truth, the vast majority of those who rely on benefits and tax credits for part of their income have worked, are in work, or will be back in work very shortly in the future.

And with estimates suggesting that around 60 per cent of welfare cuts made in this parliament will hit the working poor, the Chancellor must do much more to show he understands the problems that those on low incomes face. Rather than glib words, Osborne needs to start providing real, rather than merely rhetorical, support for hard-pressed working families and individuals.

Work and Pensions Secretary Iain Duncan Smith leaves 10 Downing Street on 5 December, 2012. Photograph: Getty Images.

Alison Garnham is chief executive of the Child Poverty Action Group

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Beware, hard Brexiteers - Ruth Davidson is coming for you

The Scottish Conservative leader is well-positioned to fight. 

Wanted: Charismatic leader with working-class roots and a populist touch who can take on the Brexiteers, including some in the government, and do so convincingly.

Enter Ruth Davidson. 

While many Tory MPs quietly share her opposition to a hard Brexit, those who dare to be loud tend to be backbenchers like Anna Soubry and Nicky Morgan. 

By contrast, the Scottish Conservative leader already has huge credibility for rebuilding her party north of the border. Her appearances in the last days of the EU referendum campaign made her a star in the south as well. And she has no qualms about making a joke at Boris Johnson’s expense

Speaking at the Institute of Directors on Monday, Davidson said Brexiteers like Nigel Farage should stop “needling” European leaders.

“I say to the Ukip politicians, when they chuckle and bray about the result in June, grow up,” she declared. “Let us show a bit more respect for these European neighbours and allies.”

Davidson is particularly concerned that Brexiteers underestimate the deeply emotional and political response of other EU nations. 

The negotiations will be 27 to 1, she pointed out: “I would suggest that macho, beer swilling, posturing at the golf club bar isn’t going to get us anywhere.”

At a time when free trade is increasingly a dirty word, Davidson is also striking in her defence of the single market. As a child, she recalls, every plate of food on the table was there because her father, a self-made businessman, had "made stuff and sold it abroad". 

She attacked the Daily Mail for its front cover branding the judges who ruled against the government’s bid to trigger Article 50 “enemies of the people”. 

When the headline was published, Theresa May and Cabinet ministers stressed the freedom of the press. By contrast, Davidson, a former journalist, said that to undermine “the guardians of our democracy” in this way was “an utter disgrace”. 

Davidson might have chosen Ukip and the Daily Mail to skewer, but her attacks could apply to certain Brexiteers in her party as well. 

When The Staggers enquired whether this included the Italy-baiting Foreign Secretary Johnson, she launched a somewhat muted defence.

Saying she was “surprised by the way Boris has taken to the job”, she added: “To be honest, when you have got such a big thing happening and when you have a team in place that has been doing the preparatory work, it doesn’t make sense to reshuffle the benches."

Nevertheless, despite her outsider role, the team matters to Davidson. Part of her electoral success in Scotland is down the way she has capitalised on the anti-independence feeling after the Scottish referendum. If the UK heads for a hard Brexit, she too will have to fend off accusations that her party is the party of division. 

Indeed, for all her jibes at the Brexiteers, Davidson has a serious message. Since the EU referendum, she is “beginning to see embryos of where Scotland has gone post-referendum”. And, she warned: “I do not think we want that division.”

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.