Balls is waking the left up to a grim truth: Labour would cut too

Not only will Labour be unable to reverse the coalition's cuts, it will have to make its own.

As I reported last night, the major announcement in Ed Balls's speech on the economy today is that Labour would remove the winter fuel allowance from the wealthiest 5 per cent of pensioners. The policy is intended as an example of the "iron discipline" on spending that the shadow chancellor would pursue in office and is designed to exploit the division between the Tories and the Lib Dems on this issue. But as spending cuts go, it's small beer. The move will save just £100m a year (less than half a per cent of the £207bn welfare bill), making it almost entirely symbolic. "Labour have brought a pea-shooter to a bazooka fight", quipped Conservative Voice this morning. 

But that shouldn't detract from the political significance of the decision. As recently as January, Ed Miliband defended universal benefits (including the WFA) as part of the "bedrock of our society" but with his support for means-testing winter fuel payments, the Labour leader has dramatically changed tack. While shadow Treasury minister Chris Leslie insisted on the Today programme this morning that Labour had no plans to remove other benefits such as free TV licences and free bus passes from wealthy pensioners, the decision to break with universalism will make it easier to justify doing so in the future. It is also a signal that a Labour government would not prioritise the reintroduction of universal child benefit, removed by the coalition from those earning £50,000 or more earlier this year.  

Balls has long acknowledged that he won't be able to reverse all (or any) of the cuts imposed by the current government (to the fury of the left), but he's had much less to say about the further cuts that Labour would almost certainly have to make in office. Based on the most recent forecasts from the Office for Budget Responsibility, the party will inherit a deficit of £108bn, or 5.9 per cent, the largest of any western nation. While Labour is likely to opt for a more even split between tax rises and cuts than Osborne (who has adopted an 80:20 ratio in favour of cuts), the burden of austerity will still fall on government spending. For that reason, the most significant passage in Balls's speech today is this: 

[T]his is the hard reality. The last Labour government was able to plan its 1997 manifesto on the basis of rising departmental spending in the first years after the election. The next Labour government will have to plan on the basis of falling departmental spending. Ed Miliband and I know that, and my shadow cabinet colleagues know that too.

With the election less than two years away, Balls is gradually waking the left up to the grim truth that I mentioned earlier: not only will Labour be unable to reverse the coalition's cuts, it will have to make its own. Means-testing the winter fuel allowance might seem bad, but much worse is to come.

While emphasising the need for fiscal responsibility, Balls is rightly continuing to make the case for stimulus now. In his speech, he will call for Osborne to bring forward the capital spending increase promised after 2015 in order to boost growth and employment. Were the Chancellor to follow his advice, Labour's economic inheritance would become less grim. But, to put it mildly, recent history suggests that he is unlikely to do so. With this in mind, Balls has embarked on a gigantic softening-up exercise. And the battles to come will make today's skirmish look like a tea party. 

Ed Miliband and Ed Balls at the Labour conference in Manchester last year. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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No, the battle in Momentum isn't about young against old

Jon Lansman and his allies' narrative doesn't add up, argues Rida Vaquas.

If you examined the recent coverage around Momentum, you’d be forgiven for thinking that it was headed towards an acrimonious split, judging by the vitriol, paranoia and lurid accusations that have appeared online in the last couple days. You’d also be forgiven for thinking that this divide was between a Trotskyist old guard who can’t countenance new ways of working, and hip youngsters who are filled with idealism and better at memes. You might then be incredibly bemused as to how the Trotskyists Momentum was keen to deny existed over the summer have suddenly come to the brink of launching a ‘takeover bid’.

However these accounts, whatever intentions or frustrations that they are driven by, largely misrepresent the dispute within Momentum and what transpired at the now infamous National Committee meeting last Saturday.

In the first instance, ‘young people’ are by no means universally on the side of e-democracy as embodied by the MxV online platform, nor did all young people at the National Committee vote for Jon Lansman’s proposal which would make this platform the essential method of deciding Momentum policy.

Being on National Committee as the representative from Red Labour, I spoke in favour of a conference with delegates from local groups, believing this is the best way to ensure local groups are at the forefront of what we do as an organisation.

I was nineteen years old then. Unfortunately speaking and voting in favour of a delegates based conference has morphed me into a Trotskyist sectarian from the 1970s, aging me by over thirty years.

Moreover I was by no means the only young person in favour of this, Josie Runswick (LGBT+ representative) and the Scottish delegates Martyn Cook and Lauren Gilmour are all under thirty and all voted for a delegates based national conference. I say this to highlight that the caricature of an intergenerational war between the old and the new is precisely that: a caricature bearing little relation to a much more nuanced reality.

Furthermore, I believe that many people who voted for a delegates-based conference would be rather astounded to find themselves described as Trotskyists. I do not deny that there are Trotskyists on National Committee, nor do I deny that Trotskyists supported a delegates-based conference – that is an open position of theirs. What I do object is a characterisation of the 32 delegates who voted for a delegates-based conference as Trotskyists, or at best, gullible fools who’ve been taken in.  Many regional delegates were mandated by the people to whom they are accountable to support a national conference based on this democratic model, following broad and free political discussion within their regions. As thrilling as it might be to fantasise about a sinister plot driven by the shadow emperors of the hard Left against all that it is sensible and moderate in Momentum, the truth is rather more mundane. Jon Lansman and his supporters failed to convince people in local groups of the merits of his e-democracy proposal, and as a result lost the vote.

I do not think that Momentum is doomed to fail on account of the particular details of our internal structures, providing that there is democracy, accountability and grassroots participation embedded into it. I do not think Momentum is doomed to fail the moment Jon Lansman, however much respect I have for him, loses a vote. I do not even think Momentum is doomed to fail if Trotskyists are involved, or even win sometimes, if they make their case openly and convince others of their ideas in the structures available.

The existential threat that Momentum faces is none of these things, it is the propagation of a toxic and polarised political culture based on cliques and personal loyalties as opposed to genuine political discussion on how we can transform labour movement and transform society. It is a political culture in which those opposed to you in the organisation are treated as alien invaders hell-bent on destroying it, even when we’ve worked together to build it up, and we worked together before the Corbyn moment even happened. It is a political culture where members drag others through the mud, using the rhetoric of the Right that’s been used to attack all of us, on social and national media and lend their tacit support to witch hunts that saw thousands of Labour members and supporters barred from voting in the summer. It is ultimately a political culture in which our trust in each other and capacity to work together on is irreparably eroded.

We have a tremendous task facing us: to fight for a socialist alternative in a global context where far right populism is rapidly accruing victories; to fight for the Labour Party to win governmental power; to fight for a world in which working class people have the power to collectively change their lives and change the societies we live in. In short: there is an urgent need to get our act together. This will not be accomplished by sniping about ‘saboteurs’ but by debating the kind of politics we want clearly and openly, and then coming together to campaign from a grassroots level upwards.

Rida Vaquas is Red Labour Representative on Momentum National Committee.