Autumn Statement 2012: A lot of Balls and a bleak midwinter?

Nik Darlington 2.57pm

I was on BBC Radio Scotland earlier talking about the Autumn Statement and just before I was due on air with the Daily Record's political correspondent, the weather report told tales of snow drifts, icy condition and road closures - painting a generally bleak midwinter picture.

In isolation, that report could’ve been about the British economy. Those heady summer days of Olympian achievement and a return to growth seem ever-more distant. This is the backdrop to what the Chancellor had to say to Parliament today, and the inclement economic weather should never be forgotten.

Indeed, Mr Osborne is set to break his own fiscal rules. Yet Gordon Brown also did that, but in the boom years - a symptom of the budgetary misbehaviour that characterised the Treasury under the feckless oversight of Mr Brown and Ed Balls.

The former Prime Minister might have lost a stick insect, but his former lieutenant was not grieving. Cheeks puce and puffed out, he berated, bewailed, gloated and tore into the man who’s office he might have had if only Alistair Darling were a lesser man.

When Ed Balls is good, presentationally at least, he is very, very good. Yet George Osborne is rarely better than when sparring with his opposite number (one gets the impression they enjoy it). I’m as unconvinced about the ‘blame Labour for all the economy’s ills’ line as I was at the time of the 2011 Budget, however Mr Osborne continues to play the card strongly, persistently and - judging by the looks on the faces of Eds Miliband & Balls - effectively. How well it plays with the public is another matter.

Former Tory whip Michael Fabricant relayed to the Chancellor the instantaneous thumbs-up from the bond markets, stating “it is the markets that matter”. Apt, to the point and certainly good news - though what voters think cannot be taken lightly either. I know what someone as acutely political as Mr Osborne will be thinking about first thing he wakes up in the morning.

Conservative MPs will be pleased with the scrapping once again of a 3p rise in fuel duty. Harlow’s MP Rob Halfon has led backbenchers on a spirited and tireless campaign against the duty, though one has to question how much gas is left in that tank. Can fuel duty rises be fought forever?

The lower threshold for income tax continues its rise towards £10,000, as expected. The personal allowance shall be £9,440 come next April.

Also to be welcomed is the further cut in corporation tax to 21 per cent. Let us not forget that it was as high as 28 per cent when the Coalition took office. Businesses can invest a greater proportion of their profits into the likes of expansion and employment. This is very good news.

The hit on working-age benefits will not play well, of course. Shrieks of unfairness can already be heard around the tenured ranks of social policy think tanks, the opposition and the like. And indeed it doesn’t look good. However, there is also the moral argument that at a time when wages are struggling to keep up with inflation, if rising at all, should welfare handouts continue to outpace? It’s a tough call, but I think it is the right one. It shall save nearly £4 billion. We can slice and dice this, that and t’other bits of public expenditure but until welfare payments are properly addressed, that ruddy old deficit shan’t budge much.

Those are my two-pennies’ worth. Plenty of ink shall be spilt and trees felled elsewhere in pursuit of explaining today’s Autumn Statement. I shall just finish with a brief thought on shale gas. I’ve had my concerns in the past about fracking for shale gas. I’m still not convinced of the safety record but I’m open to being so; and if it is the energy panacea some claim it to be, then by all means it should be pursued. Though not at any environmental cost.

Follow Nik on Twitter @NikDarlington

Tory Modernisation Needs A New Chapter

Samuel Kasumu 12.04pm

Following the recent reshuffle, many people could be forgiven for believing that the Conservative party has taken a step backwards in regards to becoming a more reflective of Great Britain.

Not only was the only ethnic minority Cabinet member, Baroness Warsi, moved on, but there was a feeling among many commentators that the party has also failed to make progress in extending opportunities to more women. Opponents of ageism also had a cause for concern as the elder statesmen were forced to retire… before they actually wanted to retire. It all paints a bleak picture for Tory modernisers.

So where do we go from here? To put it simply, we have to start winning through delivering strong and fair policy during these very tough times. We must be more affective in conveying ideas and must accept that we have neglected certain communities for far too long.

Conservatives today must start to speak up for the things that are so important to the groups that struggle to contemplate ever voting blue. We all already know that women, ethnic minorities, those with a faith, and many within inner city areas, are among the least likely to vote Conservative. Many people have analysed the reasons behind this, such as Lord Ashcroft, who published Degrees of Separation earlier this year.

But the time has come to stop debating among ourselves and start engaging with these communities before it is too late. There is nothing worse than a politician turning up a few weeks before an election having been out of site since the one five years before.

For single parents, we need to demonstrate that it is not our priority to make their lives more difficult via the long list of welfare reforms. The Universal Credit has to be better sold to those that are scared of being unable to work while bringing up a family on their own. More needs to be channelled into dealing with marriage breakdown and absent fathers must be forced to take responsibility for their children.

We must also better communicate the need for education reforms to parents across the country. We spend more than £80 billion on education but are globally ranked between 20th and 30th for English, Maths, and Science.

For ethnic minority communities, we need to end the so called war on immigration and admit that whether we like it or not our world is becoming increasingly global. Yes, borders must be tightened; but that is already happening so let’s advance the conversation and stop using cheap rhetoric to appeal to the so-called “core vote”.

This is the same “core” that was unable to deliver a majority in 2010, so perhaps it is time to start appealing to the rest of the country. The Labour party introduced the points-based system, which means non-EU migrants can only come to Britain if they are appropriately and highly skilled.

We all know that the real elephant in the room is currently uncontrollable migration from EU member states, and frankly until that is dealt with current immigration policy can be seen to be pure and simply insufficient and borderline racist. More needs to be made of the ‘transitory measures’ available to the Government.

The list could go on and on in regards to how we can develop and better communicate policies to various communities in order to demonstrate we are the correct party to choose.

In my new book, Winning the Race, launched this Thursday, I tell my story of how I joined the Conservative party as a twenty-year old, working class black male. I have never regretted the decision and can see the potential for the Tories to become the party of choice for so many people like me that are entrepreneurial and value the role of communities, family, and individual responsibility.

As Britain continues to evolve and faces an increasingly competitive global economic environment, there will be an increasingly important need for a strong government with a clear strategy for the future. One Nation Conservatism is far from an expired way of thinking. The TRG and everything it stands for must remain at the forefront of where we need to be to win a majority. For its philosophy of combining compassion with efficiency represents a way of governance that is both fair and firm, with universal appeal.

Follow Samuel on Twitter @samuelkasumu

Is David Cameron jumping the Tory electoral gun on welfare reform?

David Cowan 10.16am

Occasionally, among the static noise of 24-hour news, there comes a speech that matters. Yesterday’s by David Cameron, on welfare reform, was one of them.

The Government has already made good progress towards a better welfare state with the Universal Credit, Work Programme and the £26,000 benefits cap. But we now know that the Prime Minister and Conservative ministers have only just begun.

David Cameron is hitting back against the “entitlement culture”, which has gravely undermined a sense of “collective responsibility” that used to be so strong. It is at the heart of the ‘big society’ project to rejuvenate civil society. It is also absolutely spot on. If the state constantly intervenes in our lives instead of allowing us to live as individuals and communities, taking responsibility for our own actions, then it creates a client state of automatons.

There is already a ‘welfare gap’ between those who choose not to work and those who work and save for their family’s future. This is not because everyone on benefits is workshy but because of the perverse incentives produced by an overcomplicated system which simply isn’t working.

David Cameron is entering a potentially transformative phase in his premiership. This is not the end of ‘compassionate conservatism’, rather it is a reaffirmation of it. Instead of the lazy assumption that poverty is a problem solved by income redistribution, we are offered a more nuanced understanding. Mr Cameron highlighted the real causes of poverty, such as drug addiction, family breakdown, poor education and debt. Most importantly, he articulated the most effective solution to the problem:

"Compassion isn’t measured out in benefit cheques - it’s in the chances you give people…the chance to get a job, to get on, to get that sense of achievement that only comes from doing a hard day’s work for a proper day’s pay.

That’s what our reforms are all about. Transforming lives. Helping people walk taller.”

Elsewhere in the speech, the ‘Wisconsin model’ established during President Clinton’s administration in the US offered some inspiration: it proposes a two-year time limit on benefits, and for people receiving benefits to carry out full-time community work.

Mr Cameron also spoke about how couples on benefits were having children they obviously could not afford without state support. He proposed that income support should be stopped and additional child benefit limited for families with more than three children. Tougher measures on housing were also mooted, such as lowering the housing benefit cap further and stopping it completely for under-25s.

Deeper cuts to welfare budgets should not come as a surprise. George Osborne has already announced, in last year’s Autumn Statement, two more years of cuts and, in his Budget speech this year, the need for £10 billion of further savings from welfare by 2016 (to be outlined in the next Spending Review).

Political considerations are crucial. Downing Street’s director of strategy, Andrew Cooper, is largely responsible for the policy - his polling research showing that the benefit cap was among the Government’s more popular policies. It can prove how welfare reform is a ‘wedge issue’ on which both the Lib Dems and Labour are viewed as out of touch with the ‘striving classes’. Tougher welfare reform has now become the centrepiece of Conservative differentiation.

David Cameron has crafted a long-term vision for welfare reform that extends beyond this Parliament and establishes the groundwork for the Conservative party’s general election campaign in 2015. Undoubtedly his thinking his correct and needed but it should be some cause for concern that the coalition partners are distancing themselves to such an extent three years out from that election. The coalition needs a renewed unifying mission that goes beyond deficit reduction. A new Coalition Agreement, formulated by people such as David Laws, is what is needed now, not ‘differentiation’.

Mr Cameron’s speech is precisely what the Conservatives need to help them win in 2015. But it may have come a bit too early.

Follow David on Twitter @david_cowan