Unite political briefing on the autumn statement

Unite political briefing on the autumn statement

05 December 2013

By Jennie Formby, Unite political director

The constitutional change of fixed term parliaments, engineered to keep the Lib Dems on board has at least meant that we know, come what may, when the general election will be held. And for an intensely ideological chancellor this autumn statement was driven by politics not by economics. He claimed that the government’s policies are aimed at the long term, and there were plenty of times when it was mentioned, but that is completely disingenuous. The only date he was aiming at is the first Thursday in May 2015.

In the first few sentences this complacent Chancellor, George Osborne gloated that the economy was growing. That the infamous “Plan A” predicated on austerity had worked. But in reality as each day passes it’s their ideological goal of shrinking the state (selling off the UK’s remaining assets, turning the NHS into an insurance based service), increasing the forecast number of public sector job losses to a total of 1.1 million, letting those that caused the economic recession off the hook and letting the rest of us take the strain, that is being achieved. 

Our economy is still £40 billion smaller than pre-recession and that is because of his actions. Until we all feel better off his recovery is a mere chimera. Osborne mentioned that the Office of Budget Responsibility (OBR) has revised upwards its growth forecasts; he failed to mention that they have also revised down their forecast on wage growth. There is no end in sight for the cost of living crisis.  

Ed Miliband’s pledge that a future Labour government would freeze energy prices until the big six energy companies could be restructured and reformed, has changed the political weather.  And the Tories have been playing catch up.

The chancellor and prime minister are desperate that the autumn statement -and even that is a misnomer as the east coast of Britain is being battered by winter storms – will turn the weather vane back onto Tory territory. 

But they also know with wages stagnating - the median wage has actually fallen - and for middle income groups real disposable incomes has declined by £5,000 over the last five years the electorate may well punish them at the polling stations. 

The prime minister and the chancellor are betting the ranch on voters buying the rhetoric that ‘they’ve done a lot but the job is still not finished’. They are underestimating the electorate as the Guardian’s, Economic Editor Larry Elliott has said what we are seeing is a ‘boomlet’ rather than a boom as it is based on consumer spending – while investment (from government and business) is still fading. 

Even if there is any growth those on lower incomes will still be battered. Ever the politician, Osborne set a trap for Labour when he announced again a 'welfare cap’ and a charter for 'budget responsibility' that will cut public spending that has to come before Parliament to be renewed. The Labour leadership should not fall into the trap. There mustn’t be any triangulation. 

A further group that continues to be hit are young people. The latest unemployment figures showed that almost a million (946,000 to be exact) of them are unemployed. Despite these figures the chancellor announced that if someone leaves education and they don’t get a job they’d lose their benefits. 

Osborne himself said that if a person wants to own their own home then it is simple to fix the housing crisis – build more homes. Except all he promised was that councils should sell off social housing on expensive land. A house building programme is crucial but to link that to a demand that councils sell off expensive social housing is pretty dire stuff. If someone in social housing lives in Kensington, Westminster or Camden are they going to be evicted? It is this type of warped thinking that brought us the ‘bedroom tax’ and Ed Balls was right when he replied to the chancellor  to reiterate that Labour would scrap this hated tax. 

Responding to the autumn statement the New Economic Foundation warned that policies were leading to another housing bubble.

Len McCluskey summed it up when he said in response: “The autumn statement was an opportunity for the government to say we back the people of Britain. Instead, in a country with the longest working hours in Europe, Osborne delivered a work until you drop demand to our young and took the axe to our streets and hospitals once more.

“If you're under 40 in this country, this government is very clearly not on your side.  Wages are dropping, homes are a pipe dream and now you'll work until your 70.

“Where was the hope and measures to put money in people’s pockets, like raising the minimum wage by £1.50 an hour?  

For an autumn statement that had politics running through every word uttered the only bold announcement was that people should work longer by raising the state pension age.