Friday 20th March: The Budget confirmed that the economy is recovering, inflation is low, the deficit is falling and low borrowing costs have allowed old debts to be refinanced at cheaper rates. Also, according to the Chancellor's plans, there will be a budget surplus by the end of the next Parliament which would then allow the national debt to start falling from a higher level. That was the good news, says Dr Gerard Lyons, commenting on this week's Budget.
By sticking to his plans, the Chancellor has put a marker down for the Election with the post Budget debate focusing almost exclusively on deficit reduction and whether planned spending cuts outside the ring-fenced areas are justifiable or credible, who has suffered or gained and asking questions as to what would be the alternative.
Whereas the BBC has recently sparked an unnecessary and misleading comparison of public spending levels with the 1930s - not comparing like with like - perhaps it is the 1950s that warrants more attention. For, in that decade, Britain's post war debt levels became less of a worry, because of strong economic growth. Just as a mortgage needs to be looked at in relation to the value of a property, so too should debt be seen in relation to the size of the economy, as measured by debt to GDP.
Friday 13th March: This week Britain’s trade minister, Lord Livingston, upped the tempo on the proposed trade treaty between the US and the EU – TTIP. He and the Coalition are backing a deal destined, they say, to galvanise economies on both sides of the Atlantic. It would, Lord Livingston told a City audience, bring great economic gain – estimated at 10bn for the UK and £100bn for the EU; it would lower tariffs and prices for consumers; and it would open new markets to British businesses, bringing also the ‘soft’ power benefits of cultural links and friendship. The scenario he evoked was as difficult to punch holes in, said Boris Johnson’s global economic adviser, as to make a case against motherhood and apple pie.
Yet there are concerns. Campaigners fear for safe food, given that US food products which include GM modified food, meat with higher levels of injected hormones, and products resulting from intensive pesticide use, could find their way into Britain. Others fear massive job losses to the cheaper labour market in the US; still more fear for the NHS, Britain’s national religion, which could be threatened, say the unions, by US producer competition. The list though longer, has a common theme. TTIP would herald a ‘race for the bottom’; competition would drive down safety; labour costs would plummet; and sacred cows like the NHS would be sacrificed. Instead, the critics want safeguards to keep things in this country as they are, while some want no TTIP.
Lord Livingston responded to these concerns, and reassured the critics: EU food safety standards would apply to imports; the NHS WILL be free at the point of use; harmonisation would bring all parties to greater, not lesser, quality and higher standards. In other words, no great change other than for the common and national good. Resting his case on the advantages TTIP would bring - a more buoyant economy from which Britain would gain nationally and cheaper food for families – is in the spirited and intelligent tradition which has permeated the political debate for and against free trade for two centuries. Livingston, like his predecessors who fought againstthe corn laws in the 19thcentury or against the tariff in the 20th, has taken up the banner for the next round.
Friday 6th March: The Conservative proposal to stop child benefit for families after the third child, hit the headlines during the week, as the party mulls over the possibilities for action if returned to power in May’s election. George Osborne, the Chancellor and his party’s election strategist, is reported to be warming to the idea. Iain Duncan Smith, the Work and Pensions Secretary, battling since 2010 to cap benefit levels, has been exploring whether the benefit might stop with the second child.
Though not yet a pledge, the cut seems to tick all the boxes. Fiscally it shows determination to return the country’s accounts to the black. Economically the message is that the Conservatives can be trusted to continue the hard road of cutting the debt which stubbornly engulfs our economy, running at around £1.4 trillion. Tactically it puts Labour in an awkward spot, with many Labour voters supporting removal.
However, all is not what it seems. Fiscally, few believe that the salami slice approach to deficit and debt reduction is enough to restore this country’s long term economic fortunes; if need is to be met and the economy to grow, then structural change is needed for both the health and benefits systems - indeed, radical change. Economically, the savings involved are tiny, £300 million in all, and according to the Institute of Fiscal Studies they will take 18 years to achieve. Tactically voters tend to be more visionary than is suggested by the random single issue polling.
Right now, voters bored with the fiscal debate and tired of the politics of spin, still have more of a vision than their political masters.
Child benefit is part of that vision introduced in 1977 to replace two entitlements, one, a child tax allowance, from the breadwinner’s earnings, and the other, a family allowance, from the public purse.
Friday 27th February: The problem is not numbers but constitutional independence, says Politeia's director Dr Sheila Lawlor.
The figures for immigration this week indicate that the rise continues. 624,000 people came into Britain in the year ending September 2014 and 327,000 left. The net migration figure was 298,000, the highest for fifty years.
In London the news signalled another round of party political role play. For Labour, the Conservative policy was ‘in tatters’. For the Conservatives, the Lib Dems, the downturn in the EU, and the UK’s improving economy were all to blame. And for the Lib Dem leader, Nick Clegg, it was a matter of ‘I told you (i.e. David Cameron) so’.
Friday 20th February 2015: The Anglican bishops this week published their Pastoral Letter on the 2015 General Election. The document has prompted controversy over its authors’ implied political allegiances.