Tuesday, October 30, 2018
Austerity is still alive and kicking
The most significant announcement by the Chancellor in yesterday's budget had nothing to do with taxation, public expenditure or even the state of the economy. It was the single line about Brexit in which he signalled that austerity will continue for five more years if Britain crashes out of the EU with no deal.
It was a clear warning to MPs threatening to vote down Theresa May’s Brexit plans but it also underlined the significance of the ongoing talks and the threats emanating from the DUP, which may well dismantle the Good Friday peace agreement in Northern Ireland.
Of course even setting that warning to one side, yesterday's announcements were not enough to satisfy those hoping for a complete U-turn on the agenda of the last ten years. As the Independent reports, the respected Resolution Foundation think tank, said: “The chancellor has significantly eased – but not ended – austerity for public services. However, tough times are far from over.”
It warned that, after other spending protections for defence and foreign aid, the plan “probably means more cuts for other departments”.
And the Child Poverty Action Group seized on the failure to end the four-year freeze on family benefits – cuts in real terms – as proof there was no “substance to the claim that austerity is over”.
It is not just a no-deal Brexit that threatens the Chancellor's rosy future however. Treasury analysis has found that Brexit would leave the UK worse off under three possible scenarios: a comprehensive free trade deal, single market access and no deal at all.
The dark shadow of Brexit is looming over everything the government does. If we want to end austerity then we need to stay in the EU. Any other outcome will leave us floundering.
It was a clear warning to MPs threatening to vote down Theresa May’s Brexit plans but it also underlined the significance of the ongoing talks and the threats emanating from the DUP, which may well dismantle the Good Friday peace agreement in Northern Ireland.
Of course even setting that warning to one side, yesterday's announcements were not enough to satisfy those hoping for a complete U-turn on the agenda of the last ten years. As the Independent reports, the respected Resolution Foundation think tank, said: “The chancellor has significantly eased – but not ended – austerity for public services. However, tough times are far from over.”
It warned that, after other spending protections for defence and foreign aid, the plan “probably means more cuts for other departments”.
And the Child Poverty Action Group seized on the failure to end the four-year freeze on family benefits – cuts in real terms – as proof there was no “substance to the claim that austerity is over”.
It is not just a no-deal Brexit that threatens the Chancellor's rosy future however. Treasury analysis has found that Brexit would leave the UK worse off under three possible scenarios: a comprehensive free trade deal, single market access and no deal at all.
The dark shadow of Brexit is looming over everything the government does. If we want to end austerity then we need to stay in the EU. Any other outcome will leave us floundering.
