Osborne called out for holding "two Budgets" a year

The Autumn Statement was never meant to become a "second Budget" but Osborne has made it one. And the Treasury Select Committee is right to say so.

It's easy now to forget that George Osborne scrapped the pre-Budget report (introduced by Gordon Brown in 1997) in the belief that major decisions on tax and spending should be reserved for the Budget itself. The new slimmed-down Autumn Statement was designed to include little more than the OBR's latest forecasts on growth, borrowing and jobs. But confronted by the failure of his economic plan, Osborne has turned it into a second Budget in all but name. His most recent statement, for instance, included a freeze in fuel duty, an increase in the personal allowance to £9,440, a cut in corporation tax, a reduction in the tax-free pension allowance and the abolition of national pay bargaining for teachers.

So it's good to see the Treasury Select Committee calling the Chancellor out on his U-turn. In its report on the 2012 Autumn Statement, the committeee, which is chaired by Conservative MP Andew Tyrie, notes:

The OBR is required by statute to issue two economic and fiscal forecasts a year. The Chancellor’s own Autumn Statement, however, has now grown to be virtually a second Budget. There are good reasons for having a single substantial annual review of  the fiscal and economic state of the country, not least to enable the subsequent  presentation to Parliament of proposed tax measures and of Estimates of expenditure.  The Treasury should  re-establish the annual Budget as the main  focus of fiscal and economic policy making.

Tyrie said: "The autumn statement is not, nor should it be, a second budget. In recent years it has come to read like one.

"The case for two budgets is weak. An additional one can create uncertainty and carries an economic cost. Only in an emergency would it be likely to carry long-term benefit. The primacy of the budget as the main focus of fiscal and economic policy making should be re-established."

OBR forecasts "biased to over-optimism"

Another concern raised by the committee is that the OBR's forecasts so far have been "biased to over-optimism". It states: "This would not be a cause for concern but for the fact that the OBR’s forecasts have implications for decisions on public policy. This is because the fiscal mandate is defined with direct reference to a forecast, and because the OBR’s is at present the only official forecast against which the fiscal mandate can be measured."

Osborne reliant on "uncertain" 4G and Swiss tax windfalls

MPs also criticise Osborne for placing so much reliance on the anticipated windfall from the sale of the 4G  mobile spectrum and Swiss tax repatriation to meet his borrowing forecasts. 

The sums expected from the sale of the 4G spectrum and Swiss tax repatriation represent the majority of the additional receipts the Treasury intends to offset against the tax reductions and investment announced in the Autumn Statement for 2012–13 and 2013–14. Both are subject to uncertainty. In the case of the tax repatriation from Switzerland, the proceeds may not meet expectations if assumptions about the potential tax liabilities and expected behaviour of those affected prove not to be valid. 
As I noted at the time of the last Autumn Statement, it was only Osborne's inclusion of the expected £3.5bn receipts from the 4G auction that allowed him to claim that borrowing would fall this year, rather than rise (the boast that famously threw Ed Balls). If we strip out the £3.5bn, the forecast deficit for this year is £123bn, £1.4bn higher than last year.
 
And with borrowing currently £7.2bn (7.3 per cent) higher than at the same point last year, it's no surprise that Osborne was so keen to bag the 4G receipts early.
George Osborne poses for photographers outside 11 Downing Street before presenting his annual budget to Parliament on March 21, 2012. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Who will take responsibility for the rise in far-right terrorism?

Muslims are asked to condemn Islamist terrorism – should the mainstream right do the same when the attackers are white?

Following the attack on a Finsbury Park mosque, both Theresa May and Amber Rudd have issued statements and delivered speeches adopting hard lines against Islamophobia and right-wing extremism. May has gone so far as stating that Islamophobia itself is a form of extremism.

These pronouncements have drawn positive responses from prominent members of the Muslim community such as Miqdaad Versi of the Muslim Council of Britain. But it is important to question whether or not this change in rhetoric signifies a genuine change in government policy.

On the face of it, there are reasons for tentative optimism. The seriousness with which politicians took the Finsbury Park attack is a significant change. On this, the government is ahead of the media. While other terrorism attacks have been condemned as unjustifiable violence, some newspapers framed the Finsbury Park attack as a "revenge".

In fact, radicalisation is not a one-off event, but takes place in a web of institutional, social and ideological conditions. Furthermore this ignores a much longer story about the drip, drip, drip of Islamophobic or anti-Muslim discourse which permeates British society. 

The government has played a part in legitimising this anti-Muslim sentiment. Let’s not forget that Prevent has, since its inception, disproportionately targeted Muslims. The impression of an "us and them" mentality is only underlined by its secrecy. Moreover, the Prevent agenda has conflated a variety of other social policy concerns relating to gender equality, sexual violence, and unemployment as "extremism" issues. For example, Amber Rudd herself suggested that Islamophobia would decline if grooming stopped, which can not only be seen as victim-blaming, but further contributes to stereotyping Muslims as the enemy within.

So are promises to get serious about Islamophobia more empty words from the Prime Minister?

Think about timing. Far-right extremism has been deadly. Mohammad Saleem was brutally murdered in 2013 in Birmingham by a far right extremist. Mushin Ahmed was killed in 2015 (and was notably called a "groomer" by his attacker as his head was stamped on).

Jo Cox was murdered by a far-right extremist this time last year. This is not even mentioning individuals such as Ryan McGee, who made a nail bomb and was intent on murdering immigrants.

Just twelve days ago, the Prime Minister claimed that Britain was too tolerant of extremism, and she was right. Just not in the way she meant it.

Britain has indeed been too tolerant of extremism of the far right kind. This is a rising problem, not just in the UK, but also in Europe.

According to the defence and security think-tank RUSI, far right extremists make up 33 per cent of the threat, with Islamic extremism slightly more at 38 per cent. Furthermore, one in four referrals to Channel, the UK deradicalisation programme, are from the far right.

We cannot forget the government itself peddles the tropes of far right hate. Think of David Cameron referring to migrants as "swarms", May’s hostile environment policy, complete with "go home vans" driving around in multicultural areas, and the uncritical embrace of Donald Trump’s presidency by the Prime Minister. 

The Muslim community has been told many times to fight terrorism from within, but will there be a similar response to far right extremism? The ongoing rhetorical attacks on multiculturalism, and the longstanding association of Islamist radicalisation with a lack of integration, rather than religiously inspired political violence, make it difficult to see how real change will happen.

This would require deep soul-searching, followed by serious changes in public debates about policies relating to both immigration and extremism. Until that happens, May’s words on Islamophobia will be nothing more than political PR.

But this PR also has a more sinister element. Although no specific new counter-terrorism legislation was announced in the Queen’s Speech, there was a promise that the government would review existing counter-terrorism laws, with a spokesman stressing that new legislation would be brought forward if needed.

May continues to lobby for increased executive powers to fight terrorism, which she has done since her time as home secretary. The policy on right-wing extremism is likely to follow that of Islamic extremism: it will focus only on ideology and it will ignore the wider context of structural racism and white privilege.

Ask yourselves, will white men ever be stopped and searched to the same extent as brown men? Will white women be seen as easy targets for violent attacks as Muslim women disproportionately are? Will far right extremists fear for their citizenship status?

And does the solution to extremism, in any form, truly lie in further oppressive legislation and more government power? We also need to be aware that powers extended to address extremism are likely to continue to have a disproportionate effect on minorities.

As long as there is no change in government policy, the status quo will continue to reinforce the same divisive narrative which is the bread and butter of every extremist group. After the Queen’s Speech, we continue to see no evidence of any serious attempt to reform policy and seriously address far right extremism. May’s empty words after the Finsbury Park attack represent nothing more than an opportunistic political move from a weakened Prime Minister who is desperate for approval – and for power.

Dr Maria Norris is a political scientist researching terrorism and national security. She is a Fellow at the  London School of Economics and Political Science. She tweets as @MariaWNorris.

Dr Naaz Rashid is a Research Fellow at the School of Law, Politics and Sociology at the University of Sussex and is author of Veiled Threats: Representing the Muslim Woman in Public Policy Discourse (Policy Press 2016) about the UK government's engagement with Muslim women as part of its Prevent agenda. She can be followed on Twitter @naazrashid.

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