George Osborne's Autumn Statement: 10 things to look out for

Including, when will living standards start to rise, will there be new money for the NHS and how much more austerity is Osborne planning?

George Osborne will deliver his Autumn Statement at 11:15am today but, as so often with these events, it feels as if much of it has already been announced. The imposition of capital gains tax on foreign property owners, the freeze in business rates, the scheduled rise in the state pension age to 70 (in the 2060s) and the scrapping of employers' National Insurance for workers under 21 have all been pre-briefed to the media. 

One reason for this is that Osborne wants as much attention as possible to be focused on the OBR's improved forecasts for growth, employment and borrowing. Having responded to Labour's cost-of-living offensive by reducing green levies on energy customers, his other main aim is to shift the debate back towards the deficit and austerity, issues on which the Tories continue to out-poll Miliband's party. This being Osborne, he'll also have held at least one headline announcement back to triumphantly flourish at the end of the speech. And there's much more to look out for too

1. When will living standards start to rise? And by how much?

At present, while the economy is growing at its fastest rate for six years (and faster than any other G7 country), real wages, as Labour relentlessly points out, are still in decline, with earnings growth of just 0.8% in the most recent quarter compared to inflation of 2.2%. The Treasury's hope and expectation is that this will begin to change next year. How strong the OBR expects earnings growth to be will do much to determine the extent of any pre-election feelgood factor. 

2. More money for the NHS?

With ministers suffering sleepless nights at the prospect of a winter A&E crisis, one persistent rumour in Wesminster is that Osborne will announce additional money for the NHS. As well as helping to prevent the health service from collapse, this would offer the Chancellor a chance to reaffirm his party's commitment to the NHS and to (falsely) allege that Labour would be cutting it. 

3. How big is the output gap? (How much more austerity is needed?) 

One wonkish measure worth keeping an eye on is the output gap: the difference between actual and potential growth. The size of this will determine how much more austerity will be required to eliminate the structural deficit (the part of the deficit that exists regardless of the level of economic output) in the next parliament. 

4. Benefit cuts for under-25s

At every Budget and Autumn Statement he delivers, Osborne always finds a way to put welfare centre stage and today is likely to be no exception. One issue on which the Chancellor is expected to give more details is the coalition's plan to remove benefits from under-25s who are not "earning or learning". 

5. What's happening to income tax threshold?

Having already announced that the coalition's pledge to raise the personal allowance to £10,000 will be met by next April, there's room for Osborne to go further. Nick Clegg has urged him to raise it to at least £10,500, while David Cameron is said to be eyeing a £10,750 threshold. Osborne may well choose to keep his powder dry until the Budget but look out for a hint of further action today. 

6. When will a budget surplus be achieved?

The most significant announcement in Osborne's Conservative conference speech was his pledge to run a budget surplus by the end of the next parliament. With the OBR's updated forecasts, we'll find out when this might be achieved (today's FT suggests 2018-19). Expect Osborne to use this as his essential test of whether Labour is prepared to be fiscally responsible and as a signal of when greater tax cuts may become possible. 

7. Will Osborne halve the deficit by the election? 

Despite borrowing billions more than expected, Osborne is fond of reminding us that the deficit has still fallen by a third since the general election (from £159bn in 2009-10 to £115bn in 2012-13). If the numbers fall right today, he may well boast that he'll have halved it by the time of the general election (the Darling plan, in other words). 

8. Another cut in corporation tax?

Osborne has used almost every one of his Budgets and Autumn Statements to announce that he'll be cutting corporation tax by even more than expected (it is currently due to fall to 20% in 2015-16 from its 2010 level of 28%, giving the UK the joint-lowest rate in the G20). Today he'll publish new Treasury research showing that, in the next 20 years, the cuts are forecast to add around 0.7% to GDP (merely suggesting, as Richard Murphy puts it, that Osborne has finally discovered the multiplier), so it would be unsurprising if he chose to combine this with an annoucement that the rate will fall even further - to 19%. 

9. More public sector job losses?

As well as publishing new forecasts for growth, inflation and borrowing, the OBR will release its new estimate of how many public sector jobs will be lost over the course of the austerity programme. In the most recent Budget, this figure was put at 1.2 million but with Osborne planning further spending cuts to pay for tax cuts and benefit increases (free school meals), it could rise today. 

10. A cut in fuel duty?

The Chancellor has already vowed to freeze fuel duty for the remainder of this parliament but with the improvement in the public finances will he go further and deliver an outright cut? If Osborne is looking for a headline announcement designed to show that the government is not indifferent to the "cost-of-living crisis" this is the most likely candidate. 

George Osborne inspects material during a visit to AW Hainsworth and Sons on October 25, 2013 in Leeds. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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The polls are bad, but Jeremy Corbyn’s office has a secret weapon

How a shake-up of the leadership team has steadied nerves at the top of Labour. 

If polling had existed back in 1906, Jeremy Corbyn quipped at one recent strategy meeting, the Labour Party would never have got started.

As far as Labour’s direction is concerned, it is that meeting at four o’clock every Monday afternoon that matters. The people who attend it regularly are the Labour leader, his aides, the shadow home secretary, Diane Abbott, and the shadow chancellor, John McDonnell, as well as the party’s election co-ordinator, and their respective aides.

In recent weeks, the meetings have been stormy affairs, and not only because the numbers from the party’s own pollsters, BMG Research, mirror the uniformly bleak picture from the public polls. There is also concern over Karie Murphy, Corbyn’s office manager. Murphy is highly rated by Corbyn for having brought increased intensity and efficiency to the leader’s office. Corbyn often struggles to deliver bad news in person and appreciates that Murphy will intervene on his behalf.

Her intensity is not uniformly welcomed. “She could start a fight with her own reflection,” in the wry words of one friend. An argument with Jon Trickett – the Hemsworth MP whose unusual career trajectory took him from being a parliamentary aide to Peter Mandelson to the inner sanctum of Ed Miliband’s leadership and finally to the role of election co-ordinator for Corbyn – led to Trickett going on a two-week strike, recusing himself from vital meetings and avoiding any contact with Murphy.

That row eventually led to Trickett being stripped of his role and banished from the Monday meeting. Murphy had a similar turf war with the campaigns director, Simon Fletcher, which culminated in Fletcher resigning on 17 February. In a letter to staffers, he called on the party to “keep the promise” of Corbyn’s first leadership bid, a period when Fletcher was central and Murphy had yet to start working for the Labour leader.

All of which, in better political weather, would simply be part of the back-and-forth of office politics. However, set against the backdrop of unease about by-elections in Stoke-on-Trent Central and Copeland, and a series of unhelpful leaks, it adds to a sense of vulnerability around the leadership. One loyalist shadow cabinet minister calls it “the most dangerous time” for Corbyn since he was first elected leader.

Why the danger? Contrary to popular myth, the backbone of Jeremy Corbyn’s successive landslide victories was not a hard-pressed twentysomething, struggling to find a fixed job or to get a foot on the housing ladder. The shock troops of Corbynism, at least as far as the internal battle in the Labour Party went, were baby boomers. Many of them were either working in, or on early retirement from, a charity or the public sector, deeply concerned about the rightward drift of British politics and worried about the next generation.

Corbyn’s decision to whip Labour MPs in support of triggering Article 50 – the process whereby Britain will begin its exit from the European Union – was, in their eyes, a double heresy. The vote signalled acceptance that the forces of the Eurosceptic right had won on 23 June, and it conceded that visa-free travel, membership of the single market and freedom of movement are over.

None of this is automatically great news for Corbyn’s internal critics – not least because the vote on Article 50 is rare in being an issue that unites Corbyn with most Labour MPs. Yet it adds to the sense that his leadership has passed its best-before date.

Adding to the general malaise is a series of unhelpful leaks. There was a story in the Sunday Times on 12 February claiming that the leadership was road-testing possible replacements for Corbyn, and on 20 February the Mirror claimed that the Labour leadership had commissioned a poll to find out whether or not the leader should quit his post. These stories are hotly denied by the leader’s office. Some in Corbyn’s inner circle believe they are the work of Trickett, embittered at his demotion.

It is true that Corbyn is not enjoying the job as much as he once did. However, if the conversation shifts from the minutiae of Brexit to his natural terrain of the NHS and the continuing consequences of government cuts on education and the prisons service, he could quickly find himself relishing the role once more.

Corbyn retains two powerful cards. His newly energised office, under Karie Murphy, is one. Although her brisk approach has generated some public rows, the feeling in the leader’s office is that a chief of staff was needed, and Murphy has assumed that role. The media team has also grown sharper with the addition of David Prescott (son of John), Matt Zarb-Cousin and the former Momentum spokesman James Schneider.

Corbyn’s second asset is more unexpected. His rivals inside the party now fear rather than relish an immediate end to his leadership. A former shadow cabinet member splits his supporters into two groups: “idealists and ideologues – the first we can inspire and win over, the second have to be got rid of”. In their view, the idealists have not yet moved away from Corbyn enough to guarantee victory; the ideologues, for their part, will slink off as Corbyn puts the demands of his office above their interests, as he did over Article 50.

Although self-defeating panic has never been a rare commodity in the Labour Party, the settled view of Labour MPs is that their leader must be given time and space rather than hustled out of the door. There is an awareness, too, that MPs who are united in opposition to Corbyn are divided over many other issues.

So, while the inner circle’s Monday meetings might be fraught, and Labour’s current polling would have given Keir Hardie pause, Jeremy Corbyn is safe. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.

This article first appeared in the 24 February 2017 issue of the New Statesman, The world after Brexit