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How Osborne got caught short

Kevin Maguire's "Commons Confidential" column.

An official notice appeared in the men’s toilets outside the Commons chamber after George Osborne ladled further austerity on top of declaring war on low-earning Britons. The typed A4 sign, inside a transparent plastic sheath to keep dry both the paper and ink as red as Boy George’s extended borrowing, went straight to the point: “This Cabinet is Currently OUT OF ORDER.” And who could conceivably disagree, when the coalition has turned economic recovery into recession, when its “new politics” is worse than the old, and when Cameron’s compassionate greenwash was long ago rinsed off to reveal a diehard Thatcherite in a Buller Boy’s Edwardian waistcoat?

Briefly the movie minister in Tony Blair’s first regime, the handwringing Scottish MP Tom Clarke starred as an executioner of his Labour colleague Denis MacShane on the Commons Inquisition that is the standards and privileges committee. Yet every cloud has a silver lining. The Coatbridge assassin, muttered a snout, now occupies the former Rotherham Europhile’s much-coveted office, along from Jack Straw, under the Chamber. He moved into the vacated room on Status Row after the Inquisition forced MacShane to quit parliament over dodgy receipts to finance Continental jaunts. Not so much walking in a dead man’s shoes as sitting at a dead man’s desk, after helping despatch that very man.

Best-laid plans and all that when Michael Dugher herded a group of MPs from an Irish embassy bash to a United Arab Emirates shindig, promising a sparkling evening at what the party animal and shadow frontbencher billed as London’s equivalent of New Year’s Eve in Las Vegas. The fizz went out of the night when the posse, including those goodtime Tories, Therese Coffey and Liz Truss, arrived at the UAE reception to discover that early arrivers had drunk the oil-rich kingdom dry of champagne.

Labour’s national executive mercifully agreed to shave a day off its annual conference. This year, the jamboree will start at 11am on Sunday and finish at 3pm on Wednesday, instead of Thursday. The scheduling of Ed Miliband’s speech, however, is a trickier challenge. Panjandrums have long yearned to copy the Cons and Lib Dems, where the leader’s set piece brings proceedings to a close. The problem is the tradition of “The Red Flag”, shrouding oft our martyr’d dead, bringing down the curtain. Officials are nervous that the moment Mili sits back down, clenchedfist socialists hollering about their hearts’ blood dyed its ev’ry fold might detract from his moderate message.

The plot thickens in the All Party Writers Group. The talk is of holding creative writing courses. Doubtless handy when filling in Ipsa expenses forms.

The Islington lefty-turnedmilitant moderate Margaret “Enver” Hodge’s role as hammer of Starbucks and assorted taxshy companies is winning her new admirers. I overheard one of her fellow Blairites hail Enver Hodge as “the thinking man’s Gwyneth Dunwoody”.

Kevin Maguire is associate editor (politics) of the Daily Mirror

Kevin Maguire is Associate Editor (Politics) on the Daily Mirror and author of our Commons Confidential column on the high politics and low life in Westminster. An award-winning journalist, he is in frequent demand on television and radio and co-authored a book on great parliamentary scandals. He was formerly Chief Reporter on the Guardian and Labour Correspondent on the Daily Telegraph.

This article first appeared in the 17 December 2012 issue of the New Statesman, Will Europe ever go to war again?

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How can Britain become a nation of homeowners?

David Cameron must unlock the spirit of his postwar predecessors to get the housing market back on track. 

In the 1955 election, Anthony Eden described turning Britain into a “property-owning democracy” as his – and by extension, the Conservative Party’s – overarching mission.

60 years later, what’s changed? Then, as now, an Old Etonian sits in Downing Street. Then, as now, Labour are badly riven between left and right, with their last stay in government widely believed – by their activists at least – to have been a disappointment. Then as now, few commentators seriously believe the Tories will be out of power any time soon.

But as for a property-owning democracy? That’s going less well.

When Eden won in 1955, around a third of people owned their own homes. By the time the Conservative government gave way to Harold Wilson in 1964, 42 per cent of households were owner-occupiers.

That kicked off a long period – from the mid-50s right until the fall of the Berlin Wall – in which home ownership increased, before staying roughly flat at 70 per cent of the population from 1991 to 2001.

But over the course of the next decade, for the first time in over a hundred years, the proportion of owner-occupiers went to into reverse. Just 64 percent of households were owner-occupier in 2011. No-one seriously believes that number will have gone anywhere other than down by the time of the next census in 2021. Most troublingly, in London – which, for the most part, gives us a fairly accurate idea of what the demographics of Britain as a whole will be in 30 years’ time – more than half of households are now renters.

What’s gone wrong?

In short, property prices have shot out of reach of increasing numbers of people. The British housing market increasingly gets a failing grade at “Social Contract 101”: could someone, without a backstop of parental or family capital, entering the workforce today, working full-time, seriously hope to retire in 50 years in their own home with their mortgage paid off?

It’s useful to compare and contrast the policy levers of those two Old Etonians, Eden and Cameron. Cameron, so far, has favoured demand-side solutions: Help to Buy and the new Help to Buy ISA.

To take the second, newer of those two policy innovations first: the Help to Buy ISA. Does it work?

Well, if you are a pre-existing saver – you can’t use the Help to Buy ISA for another tax year. And you have to stop putting money into any existing ISAs. So anyone putting a little aside at the moment – not going to feel the benefit of a Help to Buy ISA.

And anyone solely reliant on a Help to Buy ISA – the most you can benefit from, if you are single, it is an extra three grand from the government. This is not going to shift any houses any time soon.

What it is is a bung for the only working-age demographic to have done well out of the Coalition: dual-earner couples with no children earning above average income.

What about Help to Buy itself? At the margins, Help to Buy is helping some people achieve completions – while driving up the big disincentive to home ownership in the shape of prices – and creating sub-prime style risks for the taxpayer in future.

Eden, in contrast, preferred supply-side policies: his government, like every peacetime government from Baldwin until Thatcher’s it was a housebuilding government.

Why are house prices so high? Because there aren’t enough of them. The sector is over-regulated, underprovided, there isn’t enough housing either for social lets or for buyers. And until today’s Conservatives rediscover the spirit of Eden, that is unlikely to change.

I was at a Conservative party fringe (I was on the far left, both in terms of seating and politics).This is what I said, minus the ums, the ahs, and the moment my screensaver kicked in.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.