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Osborne’s new job: Rewarding failure

March 20th, 2017

Don Brind on the ex-chancellor’s extra job

“He wrecked the economy and he’ll wreck anything he gets his hands on.” — the verdict on the new editor of the London Evening Standard from a Tory activist vox popped at the Conservative Spring Forum in Cardiff by Channel Four’s Michael Crick.

Brutal as it was, that judgement on the erstwhile Chancellor George Osborne didn’t, in my opinion, go far enough. Not only was Osborne a failure as a Chancellor but he is near the top of my personal Brexit Rogues’ Gallery of those I blame for putting our European future in jeopardy.

On the economy Osborne failed, of course, by his own yardstick — the promise to cut the annual budget deficit to zero by 2015. But his failure goes much wider. Although he was sacked by Theresa May last year his enduring legacy is the decade and a half of stagnant livings standards revealed last week by the Institute for Fiscal Studies. It forecast that average real earnings in 2022 will be no higher they were in 2007. IFS director Paul Johnson commented: “Fifteen years without a pay rise. I’m rather lost for superlatives.”

Johnson explained, “all of the productivity – and with it earnings growth – we would normally expect has been lost forever. This remains the big story of the last decade – a decade without growth, a decade without precedent in the UK in modern times.”

Osborne’s misguided austerity has proved that you can’t cut your way to prosperity. It has to be built through investment in infrastructure, research and development and skills. For all his talk of a “long-term economic plan” Osborne did little to tackle such issues. Britain’s productivity lags 30 per cent behind key competitors such as Germany and the United States and the gap is getting wider.

Osborne’s economic failure was the backdrop to the EU Referendum. Millions of voters thought the economy wasn’t working for them — because it wasn’t. Many used the referendum to make the protest. That’s why Osborne and his mate David Cameron are at the top of my personal Brexit Rogues’ gallery.

The Leave campaign was, of course, built on lies and false promises by the sad fact is that my side, Remain, was led people who were damaged goods so far as most voters were concerned. After Osborne’s April 2016 Budget Ipsos Mori found that there was a two-to-one majority for those who thought he was doing bad job – 60% were dissatisfied compared to 27% who were satisfied.

My Brexit Rogue’s gallery also has a place for two-faced Theresa. The then Home Secretary Mrs May was also, of course, a Remainer. She could hardly have done less to promote the cause making just one major public speech.  It is worth revisiting now because the speech was impressive in its range and powerful endorsement of the economic benefits of staying in the Single Market and contrast strongly with her current hard Brexit rhetoric it makes interesting reading.

She offered these killer facts:
• In a stand-off between Britain and the EU, 44% of our exports is more important to us than 8% of the EU’s exports is to them

• The EU is a single market of more than 500 million people, representing an economy of almost £11 trillion and a quarter of the world’s GDP. 44% of our goods and services exports go to the EU, compared to 5% to India and China. We have a trade surplus in services with the rest of the EU of £17 billion.

• We export more to Ireland than we do to China, almost twice as much to Belgium as we do to India, and nearly 3 times as much to Sweden as we do to Brazil. It is not realistic to think we could just replace European trade with these new markets.

The born-again Brexiteer can expect George Osborne to use his editor’s chair to challenge her — But forgive me for not putting much store by that. I am, however, encouraged by the defiance of Tony Blair, on the Marr Show,  Lord Michael Heseltine on Any Questions  and John Major in the Mail on Sunday.

The fight isn’t over.

Don Brind