Tag Archives: Osborne

A bad day at the office for George Osborne

What’s that on the table in front of you? Osborne with Natalie Rowe in 1994

Today marked a milestone in British history. For the first time ever, things have been a little bit tough for George Osborne. Awww.

Not only has he been caught up in a scandal that makes the Telegraph run headlines like “Phone hacking:  Andy Coulson ‘helped spin story of George Osborne and dominatrix”, but the old chap’s seat seems to have disappeared in the boundary review.

This is how it works though – you have mates that sort things out. I am not saying it is true that Andy Coulson covered over a story that potentially saved Osborne’s career – but simply it is the sort of thing that might well have happened when you grow up in Bullingdon circles. Watch as some unlucky rural Tory safe seat gets a bumbling ex-chancellor dropped in as their PPC for the next general election.

A bad day at the office possibly, but something tells me he’s going to be OK – won’t he Dave.

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The Government’s decision to implement a breathtaking 7.2% increase in beer duty is outrageous

Community pubs like the royal oak in bath may be a thing of the past if the beer tax continues to rise

The Government’s decision to implement a breathtaking 7.2% increase in beer duty is outrageous. This takes the average duty and VAT on a pint in a local pub to over £1. We now have the second highest rate of beer tax in Europe! It is simply not acceptable. The “beer escalator” commits the Government to increasing beer tax above inflation and to the wrong policy path.

Take Bath as a case in point, nearly 2,000 people depend on Beer and pubs for work and the industry contributes over £22.7 million to the local economy every year. If it continues to shrink in the manner it currently is, local economies such as Bath’s will be severely hit. At a time of recession, this tax seems to be the opposite of what the struggling industry needs.

Equally, this extra tax will do nothing to stop the irresponsible drinker but do everything to hit the responsible pub goer. It will add on 10p to every pint in the pub, while the Government’s much talked about minimum pricing of alcohol will cap supermarket booze at a price that wouldn’t deter the stingiest of consumers. It is ludicrous to allow cheap supermarket booze, whilst taxing pub goers “for health reasons” at the same time. These measures penalise the majority of responsible pub goers whilst failing to tackle the heart of the problem which remains the question of why people consume such vast amounts of alcohol (often at home not in pubs).

At a time when 37 pubs are closing down every week in the UK, we need to be supporting these centres of our community, not putting them out of business. Where do Cameron and Osborne expect the big society to meet…the local Scout hut?

SIBA chairman Keith Bott said, “This is a real kick in the teeth to the local brewing sector, one of the few British success stories of recent years. Local brewers are just the kind of business this government says it wants to see prosper: they create jobs for local people and contribute to the local and wider British economy by using home-grown ingredients. Yet the current beer taxation regime is killing off our main route to market – the British pub.”

He continued, “The Treasury claimed before the Budget that their beer duty escalator is ‘baked in’. We say it is half baked! Continuing to increase taxes on draught beer, drunk in the socially responsible environment of the pub, will serve only to increase purchases of cheap vodka for unsupervised home consumption. We fail to see how this policy can help tackle binge drinking.”

The Government’s claim to being a “pub friendly government” seems to be slipping further and further out of sight.

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Are there any good news stories to come out of the CSR?

George Osborne with his Bullingdon club friends - we are all in this together!

I am an optimist! Thus, in times of gloom I would like to take a few minuets to explore what, if anything, positive might be milked out of Osborne’s Comprehensive Spending Review (CSR) yesterday.

Firstly, in the words of the great master Yoda, the future is indeed cloudy, hard to tell what it holds.  Although I strongly suspect this won’t happen; just imagine that this economic plan worked! Just imagine if it defied the FT, Nobel Prize economist Joseph Stieglitz and the greatest economist of our age John Maynard Keynes and actually bought this country out of “the danger zone”. Our structural deficit will be eliminated within 5 years, and the theory goes, we could then re-focus our expenditure on things that we thought mattered (like schools and hospitals).  This is of course all based on the big IF Osborne is smarter than Stieglitz, the FT and Keynes!

So what about the short-term?  Is there any one in society that will benefit, or avoid feeling the pinch, of these wide-spread cuts? Well, if you habitually like going to Museums your in luck! We can still go into State owned museums for free. A priority? Churchill thought so.

If you are currently at school then your schools funding is protected…assuming you live in England.  In fact, momentarily trying to be fair, the schools budget will actually rise in real terms! This combined with the Pupil Premium, might go someway to reducing inequalities in our schools (assuming a child never leaves schools gates and has to experience the real world).  Equally, this assumes you are under 16, as the EMA has been destroyed leaving thousands of poorer students unable to fund their FE.

If you require social care, there is a possibility that you might benefit from an extra 2 billion put aside; also it is worth noting that the NHS has been ring fenced.  Hurrah. 

Now for the real winner, the International Aid budget is expected to grow to 11.6bn (from 7.7) over four years to meet UN aid commitments.  Could this be the one truly commendable aspects of the spending review?

This blog has been painful to write.  It is clear that there are some good points of this spending review (like the core point of tackling our structural deficit), but to have the audacity to claim it was a progressive piece of policy is laughable.  The Institute of Fiscal Studies took literally seconds to point out it was regressive as it will have the greatest effect on those on the lower end of income.

Thus, this leaves us, caring normal individuals, with no choice but to become part of the big society.  If the State won’t have the capacity to look after people then I guess we have to.  Either that or we can sit back and pretend people’s lives are not falling to pieces behind closed doors.  Which do you think will happen?


Filed under Economics, Politics