George osborne

Thursday

James Forsyth

A nation of shareholders?

The great sleeper issue in British politics at the moment is what to do with the state owned bank shares. The money that could be generated by a sale of these bank shares is massive. The state’s stake in RBS is bigger than all the privatizations of the 1980s combined. Nick Clegg’s proposal (£) that everyone in the country be given shares in the banks is one option. But I suspect that would overly depress the value of the shares and would reduce the amount of money that the government would have in its pre-election war-chest. A more likely option is still a scheme where these shares are sold at

Wednesday

James Forsyth

How the Tories intend to keep Westminster talking Balls

When Ed Balls is around, there are no shortages of stories. Balls, as is so often the case, has been the talk of Westminster today. First, there was the chatter generated by the FT’s story that members of the shadow Cabinet were irritated that Balls’ proposed VAT cut hadn’t been run past them. Then, there was Alistair Darling strikingly failing to endorse Balls’ VAT cut on the Daily Politics and to round it all off the shadow Chancellor was leading for Labour in its opposition day debate on the economy. The Tories are convinced that Balls’ relations with his fellow shadow Cabinet members is a weak spot for Labour. Indeed,

James Forsyth James Forsyth

Boris versus Osborne

One of the staples of the Westminster summer party season is speculation about future leadership contests and so I rather suspect that Ben Brogan’s piece on the coming George Osborne Boris Johnson leadership contest will be much referenced in the coming weeks. Any speculation about a future leadership contest is, obviously, absurdly premature. If a week is a long time in politics, six years is almost a geological era. But the prospect of Obsorne versus Johnson is, as Tim Montgomerie puts it, so ‘delicious’ that Westminster Village people will take any excuse to talk about it. What makes the contest so appetising is that Osborne and Johnson’s strengths are so

Tuesday

Fraser Nelson

The myth of cuts

Last week, Ed Balls warned against the effect of George Osborne’s vicious, front-loaded cuts. Today, we have an update in the form of monthly state spending figures. In cash terms, a new record has been set in state largesse. The UK government’s current spending was £51.7 billion in May, up from £50.6 billion in May last year (the last month of Gordon Brown). George Osborne has so far outspent Gordon Brown every month that he’s been in the Treasury. Even adjusted for the runaway inflation, the Chancellor has on average outspent Brown during his first 12 months:     To fund this extra spending, the Chancellor borrowed £27.4 billion from

Monday

Peter Hoskin

Boris’s one-two punch against the coalition

Boris, we know, has never had any compunctions about distinguishing his views from those of the coalition government. Take his recent proclamations on the unions or on the economy, for instance. But his latest remarks are still striking in their forthrightness. Exhibit A is the article he has written for today’s Sun, which — although it doesn’t mention Ken Clarke by name — clearly has the Justice Secretary in mind when it exhorts that “it’s time to stop offering shorter sentences and get-out clauses.” And Exhibit B is his column for the Telegraph, which waxes condemnatory about Greece and the euro. As George Osborne struggles to limit our involvment in

Sunday

Peter Hoskin

It’s not just about public sector pensions

The bustle around public sector pensions has obscured an equally significant, pensions-related story today: the Sunday Telegraph’s claim that George Osborne is considering sucking £7 billion from the pensions of higher earners. The way it would be achieved, reports Patrick Hennessey, would be to terminate the tax relief on pension contributions made by those in the 40 and 50 per cent income tax brackets. He adds that the Exchequer could spend the resulting funds on deficit reduction, or on notching up the basic state pension. At the moment, it sounds as though this is just one of those on-the-table type deals: an idea being passed around the Treasury, but not

Peter Hoskin

Labour’s striking attack

Quite some claim from Ed Balls, writing in the Sunday Mirror today. “Let’s be clear what George Osborne’s game is,” he blusters, “he’s trying to pick a fight about pensions, provoke strikes and persuade the public to blame the stalling economy on the unions.” And it is a charge that Andy Burnham repeated on Dermot Murnaghan’s Sky show earlier. I was on live-tweeting duty, and lost count of how many times the shadow education secretary used phrases such as “provocation,” “confrontation,” “playing politics,” and “back to the 1980s.” This, clearly, is an attack that Labour are determined to push as relentlessly as possible. George Osborne is politicking, they are saying,

Saturday

James Forsyth

Osborne throws his weight behind education reform

Pete rightly points to Michael Gove’s interview in The Times this morning as the story of the day.  Some producer interests are objecting to Gove dismissing the exam system as ‘discredited’ and his plans to return A-Levels to being a proper preparation for undergraduate study. But there’ll be no backing down. A Gove spokesman tells me that ‘’The system is discredited and it needs fixing. The public know it and support change. If some don’t like hearing that, tough. They’ll find it much more unpleasant in ten years if we don’t fix the system and they’re working for Chinese billionaires who did maths at Harvard.’ But, perhaps, the most important

Friday

Peter Hoskin

Greece on the precipice

Europe is a doom-monger’s paradise at the moment. Riots in Greece; summary Cabinet reshuffles; meetings between Merkel and Sarkozy to save the single currency — and there’s still the potential for things to get worse, much worse. If the Greek government defaults on its debts, then there’s no knowing where the contagion will spread, only that it it will spread wide: from Spain and Portugal to markets across the world. Share indices have already been trembling at the prospect, although many of them rallied slightly today. One consolation, however scant, is that all this crystallises just what can happen to governments who operate beyond their means. Indeed, this seems to

Thursday

Fraser Nelson

Balls’ bloodlust gets the better of him

Ed Balls’ problem is his killer instinct. If he were a Twilight vampire, he’d be a Tracker: someone whose uncontrollable bloodlust takes him to places he should avoid. His position on the deficit is so extreme — more debt, more spending — that he’s pretty much isolated now. People are mocking him. John Lipsky, the acting IMF chief came two weeks ago and rubbished Balls’ alternative (as Tony Blair did) — so Balls, ever the fighter, has today given a long speech where he sinks his fangs into Lipsky and says (in effect) “I’ll take on the lot of you!” But Balls is brilliant. Often George Osborne seems not to

Wednesday

James Forsyth

Osborne to sell off the Rock

George Osborne will use his Mansion House speech tonight to, in the words of one source, “fire the starting gun” on the sale of Northern Rock.   Robert Peston, who had the story first, reports that “The chancellor hopes that the sale of Northern Rock will send a powerful signal that the banking industry is on a path back to more normal conditions, following the crisis of three years ago.”   In an attempt to maximise return for the taxpayer, the whole of the “good bank” part of Northern Rock will be sold off to a single bidder. This means that the whole issue of discounted bank shares, which splits

Peter Hoskin

Osborne comes to a decision on the banks — but the story doesn’t end there

In his speech to Mansion House last year, George Osborne asked a question of his frosted and cumberbunded audience: “Should we restrict or split the activities of banks?” In his speech tonight, he looks set to deliver an answer of his own. As Robert Peston reports, the Chancellor is to announce that the investment and retail arms of banks will be ringfenced off from each other, so that the dice rolls of the Masters of the Universe cannot tumble across everyday savers’ cash. This does not mean a complete, Glass-Steagall-style separation between the two halves. But, rather, it follows the recommendations of the interim report of the Vickers Commision: banks

Tuesday

David Blackburn

Pressure at the pumps

Away from the clamour in the chamber over the bowdlerisation of the NHS reforms, a group of MPs led by Robert Halfon convened in Westminster Hall earlier this afternoon to debate how rising fuel costs might be abated. Treasury minister Justine Greening attended for the government. With the average price of unleaded at 136.9p/litre and diesel at 141.5p/litre last month, fuel costs are now a major concern for ordinary families. According to the campaign group Fair Fuel UK, who are working with the MPs, the average motorist who has to drive to work spent £33/week on petrol last year, taken from median pre-tax earnings of £499/week in 2010. With inflation

Fraser Nelson Fraser Nelson

Inflation: cock-up, not conspiracy

Britain has the worst inflation in Western Europe; this is today’s story. CPI is 4.5 per cent and RPI is 5.2 per cent. This masks even worse rises which, as the IFS says today, hit the poor hardest. The price of a cauliflower is up 38 per cent to £1.26, potatoes are up 13 per cent to £1.54 a kilo. For millions, these are the most important metrics. Historically, it’s pretty bad. You’d think a Bank of England legally mandated to keep CPI inflation at 2 per cent would be horrified at this, and start vowing to tame the cost of living. After all, this isn’t just a statistic: it

Monday

James Plunkett

Inflation hits work incentives

New inflation stats are out tomorrow and they’re expected to show further rises in CPI and RPI.  Aside from their brief peak in 2008, headline rates of inflation are now at their highest levels for 19 years.  That’s prompting more discussion about the way rising prices are playing out for Britain’s households, from a nice graphic in today’s Times (£) to a new report due out tomorrow from the IFS.  But one implication of today’s higher inflation environment is receiving less attention – the impact of rising prices on work incentives. Inflation and work incentives aren’t often mentioned in the same breath.  But when work-related costs rise more quickly than

Peter Hoskin

Miliband borrows from the Cameroons for his most substantial speech so far

Thematically speaking, there wasn’t too much in Ed Miliband’s speech that we haven’t heard before. The middle is still squeezed, the Tories are still undermining the “Promise of Britain”, the bankers are still taking us for fools, and communities still need to be rebuilt. Even his remarks about benefit dependency bear comparion to those he made in February. But there was a difference here, and that was his punchiness. The Labour leader may not be the most freewheelin’ orator in town, but the text he delivered was less wonky than usual, more coherent and spikier. It was even — in parts — memorable. You do wonder whether Miliband has learnt

Peter Hoskin

Balls bites back (with mixed success)

You certainly can’t fault Ed Balls for chutzpah. After the weekend he has just experienced, the shadow chancellor has an article in today’s Mirror accusing George Osborne of “spinning out of control”. It is pure, triple-distilled Balls: a fiery attack on both his political opponents and their policies. So let’s sup deep and read the whole thing, alongside my comments: THIS is the most exciting Formula 1 season for decades. Because it is not just about who has got the fastest car – it’s about race strategy, overtaking and adapting to the changing conditions. You can be the fastest driver on the track for 40 laps – but that’s no

James Forsyth James Forsyth

Osborne’s valuable weapon

Paul Waugh is tweeting that Number 10 is stressing that, pace this morning’s front pages and Lord Freud’s comments yesterday, the benefit cap remains. This is not surprising: the benefit cap was always a statement of values more than anything else. As George Osborne said at Tory conference, it was designed to ensure that, “No family on out of work benefits will get more than the average family gets by going out to work.” The cap was designed to say something both about the Tories’ values and those of its opponents. If Labour opposed it, they would put themselves on the wrong side of the whole welfare/fairness debate. It is

Monday

James Forsyth

The IMF delivers its verdict

While Dominque Strauss-Kahn was in a New York court room, pleading not guilty to charges of sexual assault, his former IMF colleagues were delivering their verdict on the UK economy at the Treasury. The IMF are very polite guests and their report has provided some timely support for the coalition’s fiscal approach by declaring that there is currently no need for a Plan B. The Osborne operation has been quick to point out that even in various alternative scenarios the IMF set out in their report, they don’t call for more spending or smaller cuts. But there are things which the IMF says that won’t be music to Osborne’s ears.

Fraser Nelson Fraser Nelson

Osborne’s “flexibility” explained

So what does George Osborne mean by “flexibility“? Do we hear the quiet sound of a gear change, prior to a u-turn? No, I’m told, it’s Plan A all the way. And here are the details. The government’s five-year departmental budgets (the so-called DEL limits) are set in stone. They won’t change (in cash terms) until April 15, after which no figures have been set. If inflation continues to be high, then this will exacerbate the real effect of the cuts (Osborne has already seen trouble caused by with this as inflation has turned the tiny NHS budget increase into a tiny NHS budget decrease). The OBR reckons it may