Steve Richards: Osborne is backing away from Plan A

 

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The Independent Online

George Osborne's Autumn Statement next Tuesday is becoming the political equivalent of a World Cup Final. I cannot remember an event when so many words were written or spoken in advance. The cliché "much anticipated" is applied already and we are not yet at the climactic part of the build up, the frenzy of leaks that will appear on the front pages of the Sunday newspapers.

If I were Osborne or David Cameron I would be a little worried about the attention. By instinct they are wary of too much government activity, and yet on Tuesday all eyes will be on Osborne, waiting to see which levers he will pull from the centre.

We know for sure the lever he will not pull, the one that gives any impression he is moving away from Plan A, the misjudged attempt to give his strategy sharp definition that has now become a trap. With some Conservative MPs pleading for a loosening of the straitjacket the trap becomes more politically punitive. It is easy for a young, inexperienced Chancellor and Prime Minister to announce sweeping spending cuts and tax rises when most newspapers and Conservative MPs hail their economic wisdom and political cunning. The task becomes more dauntingly nerve-wracking when the fickle chorus changes its tunes.

The chorus is not alone in looking for new melodies. Cameron/Osborne are in the market for a melodic U-turn too if their Plan does not go according to plan. Originally Osborne hoped to follow a political course close to Geoffrey Howe's in the early 1980s. By 1983, although millions were unemployed, a significant proportion of the electorate was starting to feel better off, enough to deliver the Conservatives a landslide.

Now our youthful duo realise that it is highly unlikely that there will be an equivalent number of grateful voters at the next election. Suddenly all the talk is that Cameron/Osborne will fight an election closer to 1992 when John Major won easily in the middle of a deep recession with the message that it would be better to keep ahold of nurse for fear of finding something worse.

Not for the first time their chosen composition is too derivative. Indeed Cameron/Osborne have a tendency to frame their hopes on the basis of previous successful election campaigns. They began in opposition by hoping to do something of a "1997" in reverse, projecting themselves as modernisers, speaking counter intuitively to the TUC congress and riding with huskies. After not quite winning in 2010 they had planned to fight a 1983-style election next time. Now they look to 1992 for comfort.

For leaders the future can be frightening, but the past is a treacherous guide. In 1992 the key to the Conservatives' win was a sense that there had already been a change of government after the fall of Margaret Thatcher 18 months earlier. I recall after Major became PM and Chris Patten his party chairman the BBC's then Head of News at Westminster, David Aaronovitch, suggesting astutely to his political correspondents, of which I was one, that we now had a Christian Democrat government.

The army of correspondents showed little interest, being more concerned about making an occasional appearance on a news bulletin, but as usual the former columnist of The Independent was on to something. For a time Major and Patten, tonally but also in policy terms, moved towards the centre ground, scrapping the poll tax, highlighting the importance of public services through a citizens' charter, seeking to be "at the heart of Europe". They felt new and fresh, partly because they were. In contrast Cameron/Osborne will have led their party for nearly a decade by the time of the next election and have gradually moved rightwards, the opposite of Major/Patten from 1990 to 1992.

Instead of looking to the past the Tory leadership needs to discover a distinct, authentic message of its own. That will only happen if they implement policies that generate growth. In others words if they want to win next time they will need to change the policies rather than look back at previous campaigns for a message.

To a limited extent this is already happening, thanks partly to the dynamics of the Coalition. Today Nick Clegg announces a £1 billion package aimed at getting young people into work. Apparently the additional cash is new – or at least newly applied – and will include wage subsidies for private companies on a more substantial scale than those offered under the previous Labour government. A source close to Clegg describes the internal battle within the Coalition over the policy as "like forcing a vegetarian to eat kebabs", such is the wariness of state activity on the Tory wing.

We will have to see where the money comes from on Tuesday and some reports are ominous, but given the scale of resistance this additional cash represents a victory for Clegg and Danny Alexander in their "quad" negotiations with Cameron and Osborne.

But tentative activity is not solely a consequence of pressure from the Liberal Democrats. Osborne in particular has a genuine commitment to spending on infrastructure projects. In his fateful Spending Review a year ago there was one shaft of light when he argued forcefully that it was a mistake during the recession in the early 1990s to cut back on capital spending. At which point Osborne seemed to do the same, or at least showed no urgency about giving capital projects a massive boost, a bazooka as Cameron might put it. Finally he seems ready for half a bazooka, but of course he cannot veer away from Plan A so his wheezes are aimed at keeping the debts off the public balance sheet, even if they are more expensive in the end.

The ploy has a familiar ring to it. The Private Finance Initiative was favoured by Gordon Brown for precisely the same reason. I detect a broader parallel. Osborne moves away from Plan A by stealth. At some point soon he will need to make a bigger leap. Unlike 1992, voters will have tired of nurse and will demand signs of recovery if they are to stick with the agonising treatment.

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