George Osborne stands behind the bar during a visit to officially re-open The Red Lion pub following a major refurbishment in Westminster on February 25, 2014. Photograph: Getty Images
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Budget 2014: behind the good economic headlines, warning lights are flashing

On half of the 20 key tests of economic success, Britain is faring very poorly.

George Osborne will come to the despatch box on Budget Day keen to trumpet the best economic figures since the start of the financial crisis. He will announce that the economy is growing, inflation is down and unemployment is falling. All true, but Osborne’s tone cannot be triumphant. The size of the economy remains smaller than in 2007 and family incomes are no higher than 2001. Worse still, behind the good headlines on recovery, warning lights are flashing for the future.

A Fabian Society report published last week set out 20 tests for economic success and found that on half of them Britain is faring very poorly, despite the recovery. We conclude that focusing just on GDP, inflation and unemployment is simply not enough. The Fabians propose that a future chancellor should abandon GDP growth as his main criteria for economic success and instead ask to be judged on growth in typical family incomes.

First, the grim news for British business: productivity has not increased since 2007, business investment is far below levels seen in the early 2000s and the gap between imports and exports is the widest since comparable records began. All of this suggests that the recovery is a more of a "dead cat bounce" than a return to long-term sustainable growth. Another measure of sustainability provides equal cause for concern: our emissions of greenhouse gases are not falling fast enough to meet carbon budgets for the rest of the decade, in spite of the sluggish economy.

The signs aren’t any better for family finances. It looks like most of the rewards from economic recovery are going to the wealthy, since the gap between the top one per cent and middle incomes is rising. Earnings remain flat, the number of families who don’t have enough to pay for the basics is up, and so too is the number of in debt. On top of all this, housing is now no more affordable than at the peak of the last boom.

So the Chancellor should really be using this Budget to confront Britain’s huge structural failings head on. We need a radical plan for national economic recovery focused on business long-termism and a fairer distribution of rewards which will ensure that consumer demand remains buoyant for decades to come. This won’t happen for as long as Osborne believes that public investment is negative, not positive. Over the weekend he proudly trailed a derisory billion pounds of extra investment, but only to be paid for by raiding existing department budgets. By contrast, Ed Balls has opened the way to borrowing for long-term investment, with his announcement on Labour’s fiscal rules at January’s Fabian New Year conference.

When it comes to fiscal matters, there may be a lot of sound and fury on Wednesday, but expect little real change. Osborne’s strategy is now pretty much locked down: the Chancellor wants to achieve an overall budget surplus and, by extension, a long-term reduction in the size of the state. If this really is the Conservative’s long-term strategy, it begs big questions about how the right intends to pay for healthcare and pensions for our ageing population and invest in skills and infrastructure for the future. This should be fertile ground for Labour to remake the case for government, but as things stand the opposition is feeling its way with great caution, burnt by the coalition’s united attacks on Labour’s public spending record before the crisis.

All this means that a net tax giveaway in the Budget would be a surprise. It would only be consistent with Osborne’s long-term plans if accompanied by yet more cuts, or if it could be justified by a significant change in the OBR’s forecast for the economy’s potential for growth. What’s much more likely is a big headline tax cut, paid for by less obvious tax rises elsewhere. Another increase in the income tax threshold will be a good response to Labour’s campaign on the "cost of living crisis". There are certainly many in Labour ranks who worry that in the run up to the general election, the promise of highly visible tax cuts will trump Ed Miliband’s more targeted efforts to address the living standards crisis through regulation.

For policy purists, an increase in the income tax threshold isn’t terribly sensible. Far better to reduce National Insurance for low paid workers. But it has acquired totemic significance for the coalition. Similarly, the argument over a 50p top rate of tax has acquired political weight far beyond the revenue raising or economic impacts of the policy. Labour knows it is on the right side of public opinion, but it is hardly the best way of designing taxation to ensure the rich pay more.

Privately, all the parties know that the tax system badly needs a much bigger overhaul. This needs to encompass the balance of tax between old and new economy; rich and poor; young and old; and between earnings, income, property and wealth. On top of all that we may well need more green taxes, despite the protests we can expect from the public and manufacturers.

But the annual spectacle of Budget showmanship is the wrong way to think through such major reforms. It is another example of the short-termist, confrontational politics that fails Britain. Whoever comes to power in 2015 should relegate the importance of the Budget and introduce institutional arrangements that force politicians to think ahead five years: Britain needs a long-term national strategy for sustainable growth and an independent review to design radical tax reforms.

Andrew Harrop is general secretary of the Fabian Society.

John Moore
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The man who created the fake Tube sign explains why he did it

"We need to consider the fact that fake news isn't always fake news at the source," says John Moore.

"I wrote that at 8 o'clock on the evening and before midday the next day it had been read out in the Houses of Parliament."

John Moore, a 44-year-old doctor from Windsor, is describing the whirlwind process by which his social media response to Wednesday's Westminster attack became national news.

Moore used a Tube-sign generator on the evening after the attack to create a sign on a TfL Service Announcement board that read: "All terrorists are politely reminded that THIS IS LONDON and whatever you do to us we will drink tea and jolly well carry on thank you." Within three hours, it had just fifty shares. By the morning, it had accumulated 200. Yet by the afternoon, over 30,000 people had shared Moore's post, which was then read aloud on BBC Radio 4 and called a "wonderful tribute" by prime minister Theresa May, who at the time believed it was a genuine Underground sign. 

"I think you have to be very mindful of how powerful the internet is," says Moore, whose viral post was quickly debunked by social media users and then national newspapers such as the Guardian and the Sun. On Thursday, the online world split into two camps: those spreading the word that the sign was "fake news" and urging people not to share it, and those who said that it didn't matter that it was fake - the sentiment was what was important. 

Moore agrees with the latter camp. "I never claimed it was a real tube sign, I never claimed that at all," he says. "In my opinion the only fake news about that sign is that it has been reported as fake news. It was literally just how I was feeling at the time."

Moore was motivated to create and post the sign when he was struck by the "very British response" to the Westminster attack. "There was no sort of knee-jerk Islamaphobia, there was no dramatisation, it was all pretty much, I thought, very calm reporting," he says. "So my initial thought at the time was just a bit of pride in how London had reacted really." Though he saw other, real Tube signs online, he wanted to create his own in order to create a tribute that specifically epitomised the "very London" response. 

Yet though Moore insists he never claimed the sign was real, his caption on the image - which now has 100,800 shares - is arguably misleading. "Quintessentially British..." Moore wrote on his Facebook post, and agrees now that this was ambiguous. "It was meant to relate to the reaction that I saw in London in that day which I just thought was very calm and measured. What the sign was trying to do was capture the spirit I'd seen, so that's what I was actually talking about."

Not only did Moore not mean to mislead, he is actually shocked that anyone thought the sign was real. 

"I'm reasonably digitally savvy and I was extremely shocked that anyone thought it was real," he says, explaining that he thought everyone would be able to spot a fake after a "You ain't no muslim bruv" sign went viral after the Leytonstone Tube attack in 2015. "I thought this is an internet meme that people know isn't true and it's fine to do because this is a digital thing in a digital world."

Yet despite his intentions, Moore's sign has become the centre of debate about whether "nice" fake news is as problematic as that which was notoriously spread during the 2016 United States Presidential elections. Though Moore can understand this perspective, he ultimately feels as though the sentiment behind the sign makes it acceptable. 

"I use the word fake in inverted commas because I think fake implies the intention to deceive and there wasn't [any]... I think if the sentiment is ok then I think it is ok. I think if you were trying to be divisive and you were trying to stir up controversy or influence people's behaviour then perhaps I wouldn't have chosen that forum but I think when you're only expressing your own emotion, I think it's ok.

"The fact that it became so-called fake news was down to other people's interpretation and not down to the actual intention... So in many interesting ways you can see that fake news doesn't even have to originate from the source of the news."

Though Moore was initially "extremely shocked" at the reponse to his post, he says that on reflection he is "pretty proud". 

"I'm glad that other people, even the powers that be, found it an appropriate phrase to use," he says. "I also think social media is often denigrated as a source of evil and bad things in the world, but on occasion I think it can be used for very positive things. I think the vast majority of people who shared my post and liked my post have actually found the phrase and the sentiment useful to them, so I think we have to give social media a fair judgement at times and respect the fact it can be a source for good."

Amelia Tait is a technology and digital culture writer at the New Statesman.