Responses to the CSR

Mark Ferguson:

Today’s parliamentary “festivities” started with Ed Miliband trying to strangle the Comprehensive Spending Review at birth, by noting how many previous promises – especially on infrastructure – were complete nonsense that have never happened. It was incredibly effective – and produced Miliband’s best PMQs performance in months – but he needn’t have bothered. Osborne’s CSR was less about infrastructure – although there were some vague increases in spending, too little too late – and more about nasty, vicious, small politics.

The Chancellor rose in the Commons less hoarse than usual but with a bizarre pallid expression, worsened by the thick layer of white makeup that caked his face. He looked ridiculous, as if he’d dusted himself with icing sugar, But that was where any sense of mirth in this grim event came to an end. Early on he slashed pay for public sector workers – not just for a year or two, but each and every single year for all eternity. We need more doctors and teachers, nurses and care workers – Osborne has ensured today that all of those jobs are less appealing. Slow. Hand. Clap.

But this wasn’t a serious attempt at economics. Perish the thought. These people being made worse off and losing their jobs was brought you by a party political broadcast on behalf of the oops we forgot about the growth Tory Party.

Why else would a speech on the economy make a tenuous link between Waterloo and the last Labour government? That’s right, Osborne compared Labour to Napoleon, who was responsible for millions of deaths and, in Osborne’s terms, “impoverished millions”. Which, of course, is why food bank use has skyrocketed under this government, not the last one. And it’ll skyrocket further thanks to Osborne’s latest wheeze to fiddle the books off the backs of the poor – who will have to wait a week longer to claim benefits. Hungry? Poor? Unemployed? Can’t feed your kids? Wait another week, peasant – the Tories need to throw more money at a tax cut for the richest 1%.

But it’s fine, because we can all marvel at hilarious jokes about how fatty Eric Pickles is an example of lean government, as people starve and are driven to charity by this heartless, vindictive and mean little man. Ed Balls, in response,was excellent – far better than last autumn – lambasting and lampooning the Chancellor. And I’d love to write about how good that felt, watching him whomp this ignorant fool about the chamber.

But if I did I’d be lying. Because I couldn’t stop thinking about those people. And that hunger. And those lost jobs. And those presentless Christmases. And those queues growing outside payday lenders and food banks. And I just felt fucking sick.

Mark Ferguson is editor of LabourList

Sonia Sodha:

Today’s spending round is clever political positioning by Osborne: in setting out spending plans for the year following the general election, he is shifting the debate away from the here and now to what the next government would do. All parties are committed to fiscal consolidation in the medium term. So whatever the makeup of a new government, if it wishes to deviate from these plans it will need to set out how it will reallocate cuts or replace them by increasing taxes or public borrowing.

Miliband and Balls have therefore shifted the debate in recent weeks away from the pace of deficit reduction to how Labour would cut. Labour must stress three big flaws in the way Osborne is making cuts in its response going forwards.

First, the government is taking some politically expedient but deeply unfair decisions that are bad for the country. So it is ringfencing universal pensioner benefits, some of which are paid to older people with incomes far in excess of average earnings, whilst cutting in-work benefits such as childcare support and support for young people such as the Future Jobs Fund and the Educational Maintenance Allowance.

Second, Osborne is taking a short-term view, pursuing cuts that may make short-term savings but which risk creating big long-term costs for the state. Cutting the Future Jobs Fund, early years services and social care all create long-term financial burdens for the state. Even policies the government forecasts will save money in the long-term, such as £9,000 tuition fees, may end up costing more than the old system because the government’s assumptions are far too optimistic.

Third, if any business was looking to take a fifth of its cost base out over an eight year period, it would have its best and brightest minds on the challenging task at hand, and would not be distracting them with other projects. Yet instead of using cuts as an opportunity to performance-manage out the poorest performers, many of the best staff have taken voluntary redundancy and left across the public sector.  The government’s big reorganisations in health and education are distracting health and school leaders from how to do things more efficiently when cuts to other services are loading extras onto the NHS and schools, and away from their core mission of improving outcomes.

Sonia Sodha, former adviser to Ed Miliband writing in a personal capacity.

Hopi Sen:

Beneath the boastful bombast of the spending review lay an quiet admission of failure. Austerity is continuing because austerity has failed. Capital investment and infrastructure has to be increased because to provide a framework for growth because the National Infrastructure plan hasn’t been delivered. We need a structural welfare cap because low growth means social security bills are rising. Rightly, Ed Balls and Ed Miliband today focused on that failure today, stripping away boasts to show the essential hollowness of Tory policy.
But Labour can’t just point to Osborne’s failure, however great. As the election nears, pressure increases to offer an alternative, and as it looks increasingly likely that there will be growth, however unimpressive, narrows Labour’s options. After five wasted years, debt will be high, and options limited. So Labour’s alternative has to be tight, costed and focussed.
The danger is not that Labour’s fiscally responsible postion is unpalatable to voters, who regularly tell us that cuts are needed, but being done too quickly and too unfairly, but that the legacy of campaigning against cuts look like we don’t mean it when we say our priorities is increasing investment, while limiting current spend.
There is a glimmer, a mere sliver, of good news. Osborne’s failure means that quietly, he has given up ground. There is room for a strategic state.  What money there is is flowing into housing, science, infrastructure and supporting growth. Of all those in spending departments, Vince Cable has emerged as the winner.
This is all too little, far too late, as the tiny single pot for Local growth indicates, and the cuts to local councils undermine even this. However, if Labour is brave enough to focus on investment, infrastructure, housing and growth, while retaining fiscal discipline, Osborne’s quiet retreat opens up an opportunity for Labour.
Emma Burnell:
This was a budget designed to squeeze the already squeezed. Budgets that had already been slashed were slashed again. It’s certainly hurting, and it certainly hasn’t worked.

Many of the measures announced today will impact on those already feeling insecure. They are measures that will have lifelong implications on wages and careers. Ending automatic payrises for public sector workers isn’t a short term response to a fiscal crisis. Below inflation rises in one year will affect your salary (and your ability to help to spend the economy into recovery) for the rest of your career, and there are no guarantees that the removal of automatic pay rises for low paid school and hospital workers will be a onetime deal.

Those already taking a kicking are being kicked harder. Not for any particular fiscal gain, but because Osborne can and he believes the public enjoys watching him do it. So alongside real cuts to welfare – most announced at the Budget – there were nonsense like Worksearch (which I strongly suspect was dreamed up as he finished his morning Sudoku) which means that those in long term unemployment will need to attend job centres twice as often – while the resources of the DWP are cut by nearly 10%. Where will the new funds for the job centre’s already overstretched staff come from? This is back of the fag packet stuff.

Emma Burnell, Scarlet Standard


Duncan Weldon:

This is a CSR the Chancellor did not want to deliver. His original plan was to eliminate the structural deficit by 2014/15 and leave himself room for pre-election sweeteners. Instead the failure to generate any real growth has meant serial disappointments in deficit reduction. The fiscal rules have been broken and the fiscal framework lies in tatters.

Rather than admitting his failure and changing course, the Chancellor is instead making a virtue out of necessity and carrying on with his planned cuts. Austerity was supposed to last 4 years, it now looks set to last at least 8. The triple A rating was supposed to be protected, it has been lost.

The announcements today on infrastructure appear to have been more about spin than substance. Some of the welfare ‘reforms’ mooted appear especially vicious and more pain will fall on departments that have already faced significant cut backs. In macroeconomic terms though, this appears to be a ‘non-event’ that will do little to boost our growth prospects or equip us to compete in the ‘global race’ the Chancellor is so keen to talk about.

Today was a missed opportunity, the Government could have changed course after three years of economic failure. Instead they have chosen to signal full steam ahead.

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