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.

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What is the Scottish Six and why are people getting so upset about it?

The BBC is launching a new Scottish-produced TV channel. And it's already causing a stooshie. 

At first glance, it should be brilliant news. The BBC’s director general Tony Hall has unveiled a new TV channel for Scotland, due to start broadcasting in 2018. 

It will be called BBC Scotland (a label that already exists, confusingly), and means the creation of 80 new journalism jobs – a boon at a time when the traditional news industry is floundering. While the details are yet to be finalised, it means that a Scottish watcher will be able to turn on the TV at 7pm and flick to a Scottish-produced channel. Crucially, it will have a flagship news programme at 9pm.

The BBC is pumping £19m into the channel and digital developments, as well as another £1.2m for BBC Alba (Scotland’s Gaelic language channel). What’s not to like? 

One thing in particular, according to the Scottish National Party. The announcement of a 9pm news show effectively kills the idea of replacing News at Six. 

Leading the charge for “a Scottish Six” is John Nicolson, the party’s Westminster spokesman for culture, media and sport. A former BBC presenter himself, Nicolson has tried to frame the debate as a practical one. 

“Look at the running order this week,” he told the Today programme:

“You’ll see that the BBC network six o’clock news repeatedly runs leading on an English transport story, an English health story, an English education story. 

“That’s right and proper because of the majority of audience in the UK are English, so absolutely reasonable that English people should want to see and hear English news, but equally reasonable that Scottish people should not want to listen to English news.”

The SNP’s opponents think they spy fake nationalist outrage. The Scottish Conservatives shadow culture secretary Jackson Carlaw declared: “Only they, with their inherent and serial grievance agenda, could find fault with this.” 

The critics have a point. The BBC has become a favourite punch bag for cybernats. It has been accused of everything from doctored editing during the independence referendum to shrinking Scotland on the weather map

Meanwhile, the SNP’s claim to want more coverage of Scottish policies seems rather hollow at a time when at least one journalist claims the party is trying to silence him

As for the BBC, it says the main reason for not scrapping News at Six is simply that it is popular in Scotland already. 

But if the SNP is playing it up, there is no doubt that TV schedules can be annoying north of the border. When I was a kid, at a time when #indyref was only a twinkle in Alex Salmond’s eye, one of my main grievances was that children’s TV was all scheduled to match the English holidays. I’ve migrated to London and BBC iPlayer, but I do feel truly sorry for anyone in Glasgow who has lost half an hour to hearing about Southern Railways. 

Then there's the fact that the Scottish government could do with more scrutiny. 

“I’m at odds with most Labour folk on this, as I’ve long been a strong supporter of a Scottish Six,” Duncan Hothershall, who edits the Scottish website Labour Hame. “I think the lack of a Scotland-centred but internationally focused news programme is one of the factors that has allowed SNP ministers to avoid responsibility for failures.”

Still, he’s not about to complain if that scrutiny happens at nine o’clock instead: “I think the news this morning of a new evening channel with a one hour news programme exactly as the Scottish Six was envisaged is enormously good news.”

Let the reporting begin. 

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.