CHANCELLOR Hammond used his Autumn Statement in the House of Commons yesterday to warn that the Tory war on the working class and poor is to be pursued relentlessly.
He slashed ‘growth’ forecasts and made clear that the Tories have no intention of watering down Universal Credit or the Welfare Cap, which they have brought in to smash up social security and disability benefits.
He declared: ‘Welfare spending must be within a cap set by the government and monitored by the OBR. The cap I am announcing takes into account the policy changes made since the last budget setting a realistic baseline reflecting all announced welfare policies.’
Indicating that the UK capitalist economy is rapidly collapsing, he said that as a result of the Brexit vote ‘it is more urgent than ever to tackle our economy’s long-term weaknesses’ and warned that the future holds ‘greater uncertainty and higher inflation resulting from Sterling’s depreciation’.
Deriving his policies and forecasts from the OBR (Office for Budget Responsibility created by his predecessor Osborne in 2010), he continued: ‘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 likely to be 2.4% points lower than would otherwise have been the case.
‘Uncertainty’ was his watchword, continuing: ‘The OBR acknowledges that there is a higher degree of uncertainty than is usual …’ Drawing guffaws of scorn from the Labour benches, Hammond continued: ‘In view of uncertainty facing the economy and in the face of slower growth forecasts, we no longer plan to deliver a surplus in 2019-20.’
He continued weakly: ‘But the prime minister and I remain committed to seeing the public finances return to balance as soon as practicable.’ Revealing that the UK economy is shot to pieces and neither he nor the OBR has a clue what the future holds, he declared: ‘Borrowing is forecast to be £122bn higher than forecast in March’s Budget in the period until 2021, debt will rise from 84.2% of GDP last year to 87.3% this year, and then 90.2% in 2017-18.’
But making clear that the Tory war on public services is being stepped up, he declared: ‘Public spending this year is to be 40% of GDP, down from 45% in 2010.’ Replying, Labour’s Shadow Chancellor John McDonnell said: ‘Today we expected a change in direction after those six wasted years.
‘Instead we’ve seen further cuts to earnings for those in work through cuts to Universal Credit and a Living Wage increase that is lower than expected under the previous chancellor. This is a new Conservative leadership with no answers to the challenges facing our country following Brexit and no vision to secure our future prosperity.
‘Just turning to Brexit, Labour respects the decision of the British people to leave the European Union, but the chaotic Tory handling of Brexit threatens the future prosperity of this country. The chancellor must now do the right thing for British workers and businesses. He must insist on full tariff-free access to the single market. He and the Treasury know that’s what will give the best deal for jobs and prosperity here.
‘I just say it may not be in the chancellor’s nature but in the national interest I urge him to stand up to the prime minister and the extreme Brexit fanatics in her cabinet. If he stands up for British businesses and jobs in fighting for single market access he will have our full support.
‘But after six wasted years, wages are still lower than 2008, self-employed people are on average paid less than a generation ago, six million people are earning less than the living wage.’ The Labour leaders seem to have forgotten that their job is to stand up for the working class and this means calling for a general election now to put this government out.