John McDonnell


John McDonnell

THE PRICE OF GEORGE OSBORNE’S failure is being paid for by the most vulnerable in the Chancellor’s latest Budget. It’s sad but not surprising.

  • In the six years that he has been in charge of the nation’sfinances, he has missed every major target he’s set himself. He said he would balance the books by 2015, but the deficit this year is set to be £56 billion.
  • He said he would build his way out of our housing crisis, but we’ve seen new house builds fall to their lowest level since the 1920s.
  • He said he would move the economy away from reliance on household debt, but unsecured lending is rising at its fastest rate since 2008.
  • He said he would aim for a trillion pounds of exports by 2020. But newfigures suggest he’s going to miss that target by £357 billion.

It’s not just on basic economic competence that the Chancellor has let this country down. Unfairness is at the very core of the latest Budget, and of his whole approach.

In 2010 George Osborne said that this country would not make the mistakes of the past in making the poor carry the burden offiscal consolidation. According to the Institute for Fiscal Studies, the long-run effect of all tax and benefit changes would mean percentage losses of around 25 times larger for those in the bottom decile than those in the top decile.

And time and time again, it is women who have borne the brunt of the Chancellor’s spending cuts. Recent analysis by the Women’s Budget Group showed that 81% of cuts since 2010 have fallen on women.

Young people have also paid a heavy price during the Chancellor’s tenure. It’s not just the EMA cuts in the last Parliament, or the enormous hikes in tuition fees. It’s the dream of home ownership receding into the distance for young people on average incomes.

So far on the Chancellor’s watch, people with severe disabilities were hit 19 times harder than those without disabilities. As if that wasn’t enough, the government shamefully sneaked out an announcement that they will be taking over £100 a week out of the pockets of disabled people.

Even for a Chancellor who has repeatedly cut public spending on the backs of those least likely or least able tofight back, this represents a new low.

If he can fund capital gains tax giveaways for the wealthiest billionaires in the land, why can’t he reverse this cruel and unnecessary decision? If corporation tax – already the lowest in the G7 – can be reduced yet further, surely money can be found to think again about making yet more cuts to people with disabilities.

On education, it seems that we’re also back to the politics of spin and stunts. Forcing schools to become academies will do nothing to address the shortage of teachers and school places, or increasing class sizes.

In contrast to George Osborne’s mishaps, the Labour Party will offer a real alternative. With Jeremy Corbyn as Labour leader, when we go back into government in 2020, we will build a society based on a fair tax system, where the wealthy and powerful pay their fair share of tax. We will invest for growth to build the high wage, high tech economy of the future.

In contrast to his broken promises, we will also balance government spending, using a Fiscal Credibility Rule developed, and recommended to us, by leading economists such as Joseph Stiglitz, Mariana Mazzucato, Simon Wren-Lewis and others.

We are committed to balancing government spending, but not by bullying those he thinks won’tfight back. The Labour Party has set out our alternatives to this Budget and we will continue tofight every inch of the way against the counterproductive and vindictive measures the Chancellor has set out.




Shadow Chancellor, MP for Hayes and Harlington, Chair of the Socialist Campaign Group of Labour MPs and Chair of the Labour Representation Committee. John has been involved in Labour Briefing since the early years.