Welcome to Grim Britain

Today saw the political event of the season - George Osborne's Autumn Statement.

It was all a bit depressing. The economic forecasts were bad; the debt statistics were gloomy; critics on the left thought the failure of austerity was awful; critics on the right found the lack of supply-side radicalism exasperating.

In amongst all that, there were a few policy announcements that will materially affect people's lives. Increasing the state pension by £5.30 is generous, for example, given that if they claim all their benefits pensioners are the only group that automatically meet a Minimum Income Standard. It's smart politics too, given the power of the grey vote - even if the retirement age will be edging up to 67 in 2026.

The politics around other benefits are harder to understand. Child tax credits are going up in line with inflation (though note that's less than the Government originally planned), but the Working Tax Credit for couples and lone parents will not. Some of our research partners are working out exactly what that will mean for poverty rates, but as an immediate reaction, it's hard to square with the 'make work pay' narrative.

It's also at odds with the thinking behind the upcoming Universal Credit, which is supposed to ensure there's always a financial incentive to enter employment. Universal Credit also makes this sort of tinkering with individual benefits impossible, so the measures in this Statement don't fit neatly with the longer-term approach to welfare reform.  

But despite these decisions, this was not a Statement that really shifted things. Given its main aims were always going to be credibility and relative stability, with one eye on the Eurozone debt whirlpool, I wonder if critics of both left and right were always going to be disappointed.

And so whatever your politics, it wasn't good news. And that is my overall impression of the Statement. It wasn't notable as a failure of economic management; it was a notable as final confirmation, if needed, that ours is an age of sustained austerity.

We were left in no doubt - today was about the Gathering Clouds of Economic Despair, not about the Future Sunlit Uplands of Prosperous Britain. We already felt it, and now it’s official: things are going to be tough for a long time.

Welcome to Grim Britain. You'd better get used to it.

Recommend to a friend via email: