Morning Call: pick of the papers

The ten must-read comment pieces from this morning's papers.

1. Brass tax (The Times)
Tax avoidance harms the economy - this week's developments have been welcome, says a Times editorial

2. Cameron and Chakrabarti treat press freedom as sacred (Independent)
But aren't some things more important, asks Howard Jacobson

3. Michael Gove does not deserve to be hailed as a rising star (Guardian)
His policies are bad for children and a waste of money, says Peter Wilby

4. A lot of froth over Starbucks (Telegraph)
The row over multinational tax affairs is a distraction from reducing state spending, says a Telegraph leader

5. Pay shake-up offers hope to the regions (Mail)
There's been a step towards closing the divide between the south east and the rest of Britain, says a Daily Mail leader

6. Things can only get worse. Vote Tory. (The TImes)
If Osborne brings recovery, he'll lose the next election for his party, says Matthew Parris

7. Syria and the truth about chemical weapons (Independent)
Do you know which army was the first to use gas in the Middle East, asks Robert Fisk

8. The search for paedophiles is more carnival than witch-hunt (Guardian)
Light entertainment is being turned upside down by a raucous mob, says Hannah Betts

9. David Cameron's trouble with being modern (Telegraph)
The PM must adapt, but he risks ignoring what is important, argues Charles Moore

10. Clegg is oblivious of the damage of high taxation to growth (Daily Mail)
The Deputy Prime Minister is a disaster for Britain, says Robin Harris

Morning Call
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Autumn Statement 2015: George Osborne abandons his target

How will George Osborne close the deficit after his U-Turns? Answer: he won't, of course. 

“Good governments U-Turn, and U-Turn frequently.” That’s Andrew Adonis’ maxim, and George Osborne borrowed heavily from him today, delivering two big U-Turns, on tax credits and on police funding. There will be no cuts to tax credits or to the police.

The Office for Budget Responsibility estimates that, in total, the government gave away £6.2 billion next year, more than half of which is the reverse to tax credits.

Osborne claims that he will still deliver his planned £12bn reduction in welfare. But, as I’ve written before, without cutting tax credits, it’s difficult to see how you can get £12bn out of the welfare bill. Here’s the OBR’s chart of welfare spending:

The government has already promised to protect child benefit and pension spending – in fact, it actually increased pensioner spending today. So all that’s left is tax credits. If the government is not going to cut them, where’s the £12bn come from?

A bit of clever accounting today got Osborne out of his hole. The Universal Credit, once it comes in in full, will replace tax credits anyway, allowing him to describe his U-Turn as a delay, not a full retreat. But the reality – as the Treasury has admitted privately for some time – is that the Universal Credit will never be wholly implemented. The pilot schemes – one of which, in Hammersmith, I have visited myself – are little more than Potemkin set-ups. Iain Duncan Smith’s Universal Credit will never be rolled out in full. The savings from switching from tax credits to Universal Credit will never materialise.

The £12bn is smaller, too, than it was this time last week. Instead of cutting £12bn from the welfare budget by 2017-8, the government will instead cut £12bn by the end of the parliament – a much smaller task.

That’s not to say that the cuts to departmental spending and welfare will be painless – far from it. Employment Support Allowance – what used to be called incapacity benefit and severe disablement benefit – will be cut down to the level of Jobseekers’ Allowance, while the government will erect further hurdles to claimants. Cuts to departmental spending will mean a further reduction in the numbers of public sector workers.  But it will be some way short of the reductions in welfare spending required to hit Osborne’s deficit reduction timetable.

So, where’s the money coming from? The answer is nowhere. What we'll instead get is five more years of the same: increasing household debt, austerity largely concentrated on the poorest, and yet more borrowing. As the last five years proved, the Conservatives don’t need to close the deficit to be re-elected. In fact, it may be that having the need to “finish the job” as a stick to beat Labour with actually helped the Tories in May. They have neither an economic imperative nor a political one to close the deficit. 

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