OBR head rebukes Osborne: the UK was never at risk of bankruptcy

Office for Budget Responsibility chief Robert Chote dismisses the "danger of insolvency".

In the weeks after he took office, George Osborne justified his austerity programme by claiming that Britain was on "the brink of bankruptcy". He told the Conservative conference in October 2010: "The good news is that we are in government after 13 years of a disastrous Labour administration that brought our country to the brink of bankruptcy."

It was, of course, nonsense. With its own currency, its own monetary policy and the ability to borrow at historically low rates, the UK was never at risk of bankruptcy. In extremis, the Bank of England could simply buy up government debt (as it has done through its quantitative easing programme).

So it was pleasing to see the head of the Office for Budget Responsibility (OBR), Robert Chote, state as much on last night's edition of Newsnight. He told Jeremy Paxman (from 15:17):

In terms of thinking about whether the government's finances are sustainable, a key difference [between the UK and the eurozone] is that we are in a position where we have our own currency and in that sense we have a greater degree of flexibility that means the notion of the danger of insolvency is a much different question for us.

Having established the OBR to act as a check on the government (something for which Osborne deserves praise), the Chancellor might want to listen to its head and finally concede that there was no basis for his claim in 2010.

Office for Budget Responsibility head Robert Chote at the body's briefing on the Autumn Statement yesterday.

George Eaton is political editor of the New Statesman.

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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.