Both George Osborne and Ed Balls are likely to be satisfied with their performances during the autumn statement yesterday, in what most objective people will see as a score-draw.
The chancellor failed to deliver the knockout blow to the opposition that some in Labour’s ranks had feared he might, but neither was he forced into a humiliating admission that his economic plans were in tatters.
Yes, he had to admit that he was going to miss his deficit targets again and that the Office for Budget Responsibility figures show he will borrow £219bn more than he planned to in 2010. And, yes, there is no doubt that many of the goodies he had to offer – a rise in the higher-rate tax threshold, changes to ISA inheritance tax rules, and extra spending on flood defences – amounted to little more than catnip for the Conservative core vote, rather than a large ‘something for everyone’ giveaway.
But the chancellor will feel that thanks to the comparative health of the United Kingdom economy overall and good headlines about stamp duty, he had a pretty successful day.
On the other hand the shadow chancellor will likely be also pretty pleased with his day. His performance at the dispatch box was assuredly robust and will have gone some way toward erasing the painful memories of his response to last year’s autumn statement. His best line of the day – ‘Every target missed, every test failed, every promise broken’ – offers a refrain that the party can surely return to again and again in the coming months when they need to attack the government’s economic record.
So where does over 90 minutes of claim and counterclaim from both sides leave them now?
For the Tories it appears they have been set the seemingly simple task of hunkering down until the budget next March and hoping that the chancellor can find the money for the kind of pre-election bonanza which could see them back into Downing Street. This, of course, requires the party to avoid descending into more infighting over Europe and implies that Osborne is able to find money for election bribes while the public finances remain stubbornly tight. Of course, whether both can be achieved over the next three months is far from certain.
For Labour, although the autumn statement showed that there are weaknesses in the government’s record which offer the opposition a realistic path it can take to win the election, the more pessimistic in the party would argue it also contained warning signs that, without improvement, the potential remains that it could lose and lose badly.
Yesterday underlined the need for the party to go further to assure the public of its economic credibility, while at the same time reaching out more effectively to the lower- and middle-income voters who decide elections.
That is, of course, easier said than done. In practice it means that it is no longer enough for the party to only announce new measures which benefit the bottom, at the expense of the top. An increased minimum wage, tackling zero-hours contracts and abolishing the ‘bedroom tax’ are all laudable and vitally needed things. They are all the kind of things, in fact, which core Labour voters and members expect the party to do. But the reality is that on their own they will not be enough to deliver an election victory because they do not affect the vast majority of people on a day-to-day basis.
Now is the time, then, when – alongside these strong policies – the party needs to make an explicit pitch to the majority of voters. Or, in other words, to show how it would unsqueeze the middle.
If Labour can do this successfully and assure voters is can be trusted with the economy in the coming months, then it can leave Osborne playing catch-up in the budget. If not it may find that there is not enough time after the budget to make up that lost ground before the election.
All in all, yesterday provided us with plenty of gimmicks and much to ponder, but neither the chancellor nor his shadow could produce a gamechanger. Today both parties will feel that it is still all to play for.
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