Tory chancellor George Osborne last week unveiled what the right wing press called his pre-election “feel good budget”—but with little to feel good about.
Osborne had already pledged to keep slashing public spending if the Tories are elected in May.
That means £12 billion of cuts from benefits and £13 billion from government departments.
Increasing the tax free income allowance lifts 200,000 people out of income tax, though not social security. But up to five million workers are too poor to benefit.
And getting the first £1,000 of interest tax free on savings will make little difference to most basic rate taxpayers.
Far from saving tens of thousands, the average household will have debts worth almost £10,000 by the end of next year, according to accountants PriceWaterhouseCooper.
The real winner on taxation is big business. Their corporation tax has been reduced to a new low of 20 percent.
Osborne threw more cash at pushing up house prices through his Help To Buy scheme—a subsidy that helps rich developers more than first-time buyers.
Then there’s a series of military re-enactments and celebrations. Osborne mentioned the 1415 Battle of Agincourt in his speech more times than the NHS.
Another round of “buy 350 pints get one free” cuts on alcohol duty won’t help drown the sorrows previous budgets have caused.
But the closest thing to good news was a U-turn on excluding brass bands and Scottish pipers from a tax cut for orchestras.
Osborne did say things would improve in five years. But similarly sunny “projections” he made five years ago now lie in tatters.
The weak economic recovery has been the slowest in three centuries. The economy is 5 percent smaller than Osborne said it would be.
Wages are still much lower than they were before the economic crisis. And they’re growing at 1.6 percent a year, rather than the 5.4 percent Osborne projected.
It’s true unemployment is going down. But these new jobs are so low paid that they make no difference either to workers’ living standards or the government’s tax returns.
So Osborne has had to keep moving the goalposts on his task of reducing the deficit run up by the bankers’ crisis.
The extra five years of misery he is promising now are precisely what the last five years of misery were meant to avoid.
Labour pointed to Osborne’s failure. But it only offered variations within the same spending limits.
As Tory columnist Matthew d’Ancona gloated in London’s Evening Standard, this “convergence” between the two parties is Osborne’s real success.
Beyond fantasy figures and made up graphs, the budget only confirmed that the Tories will keep attacking us for as long as they can get away with it.
Stopping the assault will take a bigger fightback than we have seen so far.