George Osborne's Conservative fringe appearance: 10 things we learned

Including, his parents were non-Tory voters and Gordon Brown is the only politician "he found it impossible to have a civil relationship with".

It's been a while since anyone called George Osborne "the submarine" - and with good reason. The man previously known for surfacing only for set-piece events and retreating under water at the first sign of trouble, has become one of the government’s most visible faces. In the last year, he has made a series of high-profile speeches on the economy, taken the fight to Alex Salmond in Scotland, and braved the world of Twitter. The morning after the government’s defeat over Syria, it was the Chancellor who led the counter-offensive on the Today programme.

After his strikingly personal speech to the Conservative conference yesterday, in which he referenced his children and his parents (seen by many as preparing the ground for a future leadership bid), Osborne made a rare appearance on the fringe at lunchtime, speaking to Channel 4 News's Gary Gibbon. Here are ten things we learned.

1. His mum has voted Labour and his dad used to vote Liberal but both now vote Conservative.

2. Gordon Brown is the only politician "he found it impossible to have a civil relationship with".

3. He believes the Tories "never really" worked out how to deal with Tony Blair, "the master of the political landscape", and "need to understand why he was appealing".

4. He conceded of the 2012 "omnishambles" Budget: "in my job you're not supposed to make those political miscalculations."

5. After pledging in his speech to achieve a budget surplus by the end of the next parliament, he has not decided whether to continue to ring-fence health and international development spending.

6. Nigel Lawson's children helped persuade him to move his family to No. 11 Downing Street.

7. He sees himself as "a social liberal, small 'l'" and cited his strong support for equal marriage and gay rights.

8. He "does not want to run the election campaign" (Osborne is still officially the Tories' chief election strategist), "which is why we've got Lynton Crosby in. I was the one who approached him."

9. While refusing to comment on his reported leadership ambitions ("I'm not going to fall for that"), he believes that as Chancellor he has "an obligation to get out and about".

10. Michael Gove joked (brilliantly) of his new hairstyle: "you've applied your economic policy to your hair. You've turned it around to stop the recession."

George Osborne delivers his speech to the Conservative conference in Manchester. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty Images
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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR