Autumn Statement: George Osborne and his pitch for power

THIS was not just an Autumn Statement which set out the Government’s economic and spending parameters for the duration of this Parliament. It was also a political pitch for power by George Osborne in which he reaffirmed his position as David Cameron’s most likely successor.

Like Gordon Brown during the New Labour years, Mr Osborne is not afraid to use these setpiece speeches to assert his authority over possible rivals – the Chancellor clearly wanted to take the credit for the decision to protect police spending rather than afford Theresa May this opportunity.

But it is here that the similarities end. For, while Mr Brown presided over a reckless expansion of the public sector and state apparatus that proved impossible to sustain, the current occupant of 11 Downing Street is trying to bring about a greater focus to spending.

He is right to do so. For, while public spending will, contrary to perception, continue to rise every year until the 2020 election, this expenditure does need to be reined in to ensure that it can be supported by a still fragile economy, and without the need to resort to tax increases.

This also assumes that Mr Osborne’s economic forecasts are accurate – the Chancellor surprised many by announcing that the state of the public finances had, in fact, improved by £27bn since the summer Budget in July and that the Government is still on 
track to record a surplus 
by 2019-20.

This goes a long way to explaining why Mr Osborne could protect police spending, front-load previously promised additional investment in the National Health Service and reverse controversial changes to tax credits which threatened to penalise the very people who are striving to become less dependent on the benevolence of the welfare system.

He has proved to be a listening Chancellor while also not deviating from his primary purpose which is to make the country’s finances more resilient so it is better placed to withstand future turbulence within the global economy – he is clearly determined to make the most of the fact that Britain is now the best performing G7 country.

That this country is set to enjoy a steady increase in GDP over the next five years – increases in growth are projected to vary between 2.3 and 2.5 per cent – also suggests that Mr Osborne is presiding over a recovery which is being built to last rather than Labour’s “boom and bust” economics.

Yet two significant imponderables remain. The first is the precise identity of the services to be cut – the Chancellor was at pains to point out those areas of spending that will be protected. The other is Yorkshire’s devolution deal – this remains the one region which has not yet reached an agreement with the Treasury on its future governance. Mr Osborne should be experienced enough to realise that both will be critical to making sure that this Autumn Statement transforms Yorkshire and the North into the economic powerhouse that he so envisages. In the spirit of the Chancellor’s oft-repeated line about Britain becoming a nation of builders, he now needs to build on the firm foundations that he has already laid.