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John McDonnell wants to defend pensioners - but will they return the favour?

McDonnell senses a chink in the Tories' armour. 

A 34th birthday is associated with hangovers, impending middle age – and voting Conservative. That last bit is according to YouGov, which says the age of 34 is a “tipping point” at which voters are more likely to favour the Conservatives over Labour. For every ten years older a voter is, their chance of voting Conservative rises by roughly 8 per cent, and the chance of them voting Labour decreases by 6 per cent.

Labour’s shadow Chancellor, John McDonnell (65), wants to change that. He jumped on the Tories’ manifesto plans to remove some of the generous universal benefits pensioners enjoy. At a press conference a day later, he posed beneath a Labour poster of a figure with three boxing gloves. Pensioners, McDonnell declared, are facing “a triple whammy” from Theresa May. 

McDonnell senses a chink in the Mayan armour. He spent the bulk of the press conference talking about the cuts to winter fuel allowance. “I don’t want our pensioners to be cold this winter,” he said. Means testing such a vital benefit, he argued, would make pensioners less likely to claim and cost more in terms of administrative charges. He cited Resolution Foundation prediction that 10 million pensioners would be affected.

While all but the coolest millennial cannot help but be moved by freezing pensioners, younger voters are unlikely to feel quite so sympathetic about the other policies at stake. Labour is now defending the triple lock – the pledge to raise the state pension by 2.5 per cent, the rate of inflation, or average earnings, whichever is highest. Pensioners are much more likely to own their own homes. The typical pensioner household is £20 a week better off than the typical working age household. 

In the press conference, McDonnell argued that Labour will be looking after working families by scrapping the Bedroom Tax, reinstating housing benefit for young people and other measures. Abolishing university tuition fees will be a boon for one group of young (mostly middle class) voters in particular. This is unlikely to convince young taxpayers long overdue a wage increase. 

Still, while McDonnell’s defence of middle class pensioners may be economically wonky, it is politically astute. A poll by Old Mutual Wealth found a third of over 55s were less inclined to vote Conservative if the triple lock was at risk. And pissing off millennials is a low-risk strategy for Labour. After all, another thing goes up with your age – your likelihood of voting in the first place.

 

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.