Budget 2015: George Osborne, the Chancellor that everyone – except Ed Miliband – could see coming

The Chancellor’s Budget went half way towards deflecting Labour’s attacks on the Conservatives

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The Independent Online

George Osborne promised tax transparency and he delivered. We could see right through him. We knew he would use the windfall of the low oil price and therefore low inflation plus lower spending on unemployment to try to neutralise Labour’s attacks on him. And so he did.

The level of public spending as a share of the economy will not go back to that last seen in the 1930s but to 2000. Labour cannot accuse Osborne any longer of wanting children to go to school without shoes in the sepia-tinted years before the NHS. Now the Conservatives want to go back to the golden years of Gordon Brown, the most popular postwar chancellor (before he lost control of the public finances).

Instead of trying to squeeze the public finances so hard that there would be a big surplus after five years, Osborne is going to ease off and settle for a small surplus in 2019-20. Broadly speaking, he has halved the difference between his plan and Labour’s plan. That makes it twice as hard for Labour to accuse him of fomenting austerity for the sake of it. Ed Balls is under more pressure to explain why he wants to borrow more, because the Tory spending cuts are now only half as unreasonable as they were. Then Osborne said that “the rich” would bear the greatest burden of closing the deficit. This is true. There is a fancy chart at the back of one of the Treasury documents, called “Impact on households: distributional analysis”, to prove it. But it is all a bit dry, and there is nothing of the symbolic power of the cut in the top rate of income tax to help this message to cut through to the public’s mind.

So the Budget was a job half done. Half way towards accepting that Labour is right about the path of deficit reduction; half way towards dealing with the perception of the Conservatives as the rich people’s party.

Osborne even went half way towards taking away the money on which Ed Balls was relying to pay for Ed Miliband’s promise to “cut” tuition fees – he announced part of the change to pensions tax that Balls was intending to announce.

 

Even the boast that people are, er, would be, might be, depending on the forecast and the measure used, better off in real disposable income per head (before housing costs) in 2015 than they were at the last election – even that had to be fudged and hedged.

“The sun is starting to shine and we are fixing the roof,” said the Chancellor, mangling his metaphor, but trying to counter another weakness, that the Tories are seen as negative, miserable and uninspiring.

The one person who hadn’t seen Osborne coming, however, was Ed Miliband. You would have thought that the Leader of the Opposition would have anticipated all the ways that Osborne would close off Labour’s lines of attack, but none of them seemed to have occurred to him. He flailed, to put it politely.

He had one good line: “The only thing long term about his plan is that it will take twice as long to balance the books.” But instead of forensic mockery of what Osborne was actually proposing, which could have been devastating, we got mindless exaggeration, claiming that the Tories had a secret plan to cut the NHS.

He said that there was a “glaring omission” in the Budget speech. He meant the plans for spending on public services, but the most striking omission was that of any substance in Miliband’s reply.

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