CHANCELLOR Hammond began his Autumn statement yesterday by saying, ‘Our task now is to prepare our economy to be resilient as we exit the EU.’ With 90% of the big bosses and MPs opposed to this road, and determined to block it, this must be the understatement of the year!
He fantasised that: ‘As the effects of uncertainty diminish, the OBR forecasts growth recovering to 1.7% in 2018, 2.1% in 2019 and 2020, and 2% in 2021.’ He predicted that, ‘While the OBR is clear that it cannot predict the deal the UK will strike with the EU, its current view is that the referendum decision means that potential growth over the forecast period is 2.4 percentage points lower than would otherwise have been the case.’
He added: ‘The OBR acknowledges that there is a higher degree of uncertainty around these forecasts than usual.’ Uncertainty rules! What Hammond is certain about is that, ‘In view of the uncertainty facing the economy, and in the face of slower growth forecasts, we no longer seek to deliver a surplus in 2019-20. But the Prime Minister and I remain firmly committed to seeing the public finances return to balance as soon as practicable.’
This task is enormous since total government debt is at £1,684,537,383,467 (£1.68 trillion) and going up by the second! He then targeted the public sector and welfare as the villain of the piece, saying, ‘In the absence of an effective framework, the welfare bill in our country spiralled out of control, with spending on working-age benefits trebling in real terms between 1980 and 2010.’ It’s Labour and the working class that did it!
Praising Osborne’s savage austerity, he declared: ‘As a result of the action we’ve taken since 2010, that spending has now stabilised.’ He continued to promise more: ‘I shall announce today, the OBR now forecast that in cash terms, borrowing is set to be: £68.2 billion this year; falling to £59 billion next year; £46.5 billion in 2018-19; then £21.9 billion; £20.7 billion, and finally £17.2 billion in 2021-22. Overall public sector net borrowing as a percentage of GDP will fall from 4% last year to 3.5% this year, and will continue to fall over the Parliament, reaching 0.7% in 2021-22.’
Hammond then declared that, ‘The productivity gap is well known, but shocking nonetheless. We lag the US and Germany by some 30 percentage points. But we also lag France by over 20 and Italy by 8. Which means in the real world, it takes a German worker 4 days to produce what we make in 5; which means, in turn, that too many British workers work longer hours for lower pay than their counterparts.’
The UK workers obviously need a good kicking according to Hammond. They must have grown fat and lazy on welfare! However, the fact is that British capitalism is backward and its banking-dominated economy needs liberating by a socialist revolution. Hammond then outlined the government’s way forward.
He said: ‘The government, Mr Speaker, has pledged to invest in our NHS and we are delivering on that promise: backing the NHS’ Five Year Forward View plan for the future with £10 billion of additional funding a year by the end of 2020-21.’ This is the STP programme to shut down scores of A&Es and tens of hospitals!
‘Today I can announce the National Living Wage will increase from £7.20 to £7.50 in April next year.’ With inflation starting to run riot, 0.30p an hour rise is taking the mickey! He continued: ‘Universal Credit is an important reform to our benefits system and is designed to make sure work always pays. We want to reinforce that position.
‘From April, we can reduce the Universal Credit taper rate from 65% to 63%.’ This slight adjustment will still leave the poorest families losing thousands of pounds. Hammond also announced: ‘I can announce today that we will ban [letting agents’] fees to tenants as soon as possible.’ This will just mean landlords imposing rent rises on hard-pressed tenants.
His coup de grace was to announce that this was his first and last Autumn Statement. He said: ‘Mr Speaker, I am abolishing the Autumn Statement,’ as he was advised to do by the IMF, again because of the ‘uncertainty’ of the situation. With British capitalism in its death agony, one thing is absolutely certain, the working class must put it out of its misery with a socialist revolution in the period directly ahead!