Morning Call: pick of the papers

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

1. Falkirk may seem minor, but for Labour it really matters (Guardian)

The Unite union's tactics in the selection of parliamentary candidates are a direct challenge to Ed Miliband's leadership, writes Martin Kettle.

2. People Power (Times)

Now Egypt’s Army has taken control, its most important task is to relinquish it, says a Times editorial.

3. Egypt's coup: a ruinous intervention (Guardian)

Those who believe the Egyptian army's priority is to preserve freedom will soon be disappointed, says Jonathan Steele.

4. HS2 must not fail. If it does, investment in our future is doomed (Independent)

In this country a gimmick, like the Olympics, is required to justify spending, writes Steve Richards.

5. Why doors slam in Snowden’s face (Financial Times)

Who wants to pick a fight with the US over someone who has revealed what we knew, asks Philip Stephens.

6. To Lord Freud, a food bank is an excuse for a free lunch (Guardian)

The welfare minister's attempt to link the rise in food banks to greed rather than poverty shows a withered meanness, says Zoe Williams.

7. In or out, Britain has to play by Europe’s rules (Times)

Norway and Switzerland pay the costs of membership wth no say over EU law, writes John Cridland. That’s a bad deal for UK businesses.

8. The brave souls who resisted the march of state control (Daily Telegraph)

Professor Minogue was one of a small group of thinkers who fought for individual freedom, writes Peter Oborne.

9. What works at the Fed may not in Britain (Financial Times)

Forward guidance must be based on firm criteria, not least increased spending, writes Chris Giles.

10. Spying was simpler during the Cold War (Daily Telegraph)

You knew who your friends were during the Cold War – and you didn’t snoop on them, says Sue Cameron.

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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.