Fishburn Hedges: Autumn Statement Briefing
Plan A is working. This was the key message from the Chancellor today as he unveiled an Autumn Statement with a ‘steady-as-she-goes’ message that the Government is securing the recovery. However, he also warned that risks remain and sticking to the plan is vital to secure growth – pushing the underlying message that only the Conservatives can do that.
While there were no real surprises today, the OBR’s upgraded forecasts give tangible evidence of a return to growth. That means this is a significant moment in the lifetime of the Coalition, providing the Government with evidence that the difficult decisions they have made have been worthwhile.
But as the fight for control of the political agenda and attention of the electorate continues, Osborne appeared to nod to criticism that many people were facing a ‘cost of living’ crisis by outlining a series of populist measures designed to ensure voters personally felt the recovery.
In a heavily pre-briefed Statement, Osborne confirmed that:
- Green taxes would be shifted, allowing a £50 cut in energy bills – that most energy suppliers have agreed to pass on to customers;
- Rail fares will be frozen in real terms next year (i.e. only rise with inflation), and there will be another fuel duty freeze;
- The state pension age will – eventually – rise to 70;
- Employers' national insurance for young people will be scrapped;
- Help for the high street with business rate increases capped at 2%;
- The OBR has upgraded its growth forecasts, and is now predicting a 2.4% rise in GDP in 2014.
This was the most good news Osborne has ever been able to give in an Autumn Statement or Budget.
But it’s a balancing act: Osborne was keen to show that there’s a long way to go before the deficit is eliminated.
His underlying message remains that only the Tories can secure the recovery – in the week that research by Britain Thinks revealed voters believe Conservatives make tough but necessary decisions, but Labour doesn’t.
Labour continued its accusations that the recovery does nothing for real people and that there’s a cost of living crisis, including releasing a ‘bombshell’ poster this morning.
The Statement was really a warm-up for the Conservative electoral strategy to come: the recovery is fragile and Labour’s lack of fiscal discipline would severely undermine it. It remains to be seen whether Osborne will use today’s forecast upgrades as a platform for bigger announcements in the Budget come March.
Fishburn Hedges Director Rory Scanlan said:
"Many will rightly see today’s Autumn Statement as a turning point for the economy. Accelerating growth can now be cited as vindication that Plan A worked.
"But the key question is whether firm evidence of an improving economy marks a turning point for the Conservatives.
"The Tories’ message for 2015 is clear: we’re on the right track, don’t let Labour ruin it."