Today was George Osborne’s eighth budget and, like all that preceded it, the political rhetoric and sweeping statements failed to disguise a total absence of policies which would set Britain on the path for sustainable growth, harnessing our productivity and economic potential.
The chancellor has seen his own estimates and targets downgraded yet again – our growth rates have been revised downwards and borrowing is expected to be higher every year until 2021. Osborne is once again failing to meet his own economic targets.
It was also a budget which laid bare this chancellor’s priorities. The amount the government said they needed to save in axing personal independence payments for disabled people is equal to the amount Osborne has had to find to fund his capital gains tax credit which will benefit the richest in our society. Nothing symbolises better this chancellor’s approach to managing the public purse.
Last year’s productivity plan included no reference whatsoever to the self-employed. Today’s announcement on tax relief is a welcome gesture. It is a mantle that Labour must now seize and give the policy development it deserves. The proposals to introduce a more onerous system of tax returns for the self-employed and changes to dividend taxation which will hit small and micro-businesses, the government is still failing to stand up for the self-employed and small businesses. Therefore, Labour must.
In many ways, the budget was notable for what it did not cover rather than for what it did. The care home sector in England is on the brink of a major crisis which could see thousands of vulnerable older people’s care home beds at risk. This has been caused by cuts to local authority budgets and the pressures that the national living wage, which the government has failed to properly fund for local authorities, will bring. There were no new announcements for this vital area today and many in the sector will be looking nervously at their balance sheets as the next funding squeeze really begins to bite from April.
Given we are in apprenticeship week, the chancellor seemed remarkably quiet on the topic. I know from my conversations with them that businesses remain very concerned about the proposed levy and how this will operate in practice. No further details were forthcoming in the budget, and with its introduction due next year, firms are being given minimal time to plan for such a major upheaval in skills funding. Such an approach will do little to help solve the productivity gap the government loves to talk about so much.
These failings open the door to Labour if we can show we are on the side of the self-employed, smaller and micro-businesses, which form the bedrock of the local economy in my constituency of Hove and Portslade and countless other towns and cities across England which we need to win back if we have any chance of success in the 2020 election. As well as the crucial task of rebuilding the party’s economic credibility, our job now to go out there, listen to their concerns and build a platform which can deliver the environment for them to flourish.
On Tuesday 22 March at 5.30pm in Committee Room 14 Peter is hosting ‘The Argument Live’. Philip Collins from the Times will deliver a 25-minute lecture on the back of his essay for the first edition of the Argument which was recently launched and can be viewed here.
After Philip’s presentation will be a discussion of his article and lecture, both of which are challenging and provocative but give plenty of thought to how the Labour party can inspire passion and trust enough to win again in 2020. Please do read the article before the event.
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