What are the worst things Osborne can do today?

Posted on

I've said what I'd like from the budget. But what are the things I fear from it?

Sicking to Plan A is, of course, the worst thing George Osborne can do. Cutting the public sector when there is no chance o a private sector recovery - in no small part precisely because he's cutting the public sector - is the recipe for economic disaster for this country - and rising unemployment, borrowing and inflation matched by lower growth are the proof of it.

Next, his plan to privatise everything is a disaster. It opens up all government services to competition - competition the private sector can always win because it cherry picks and will never budget for training and investment. There will be no level playing field. The destruction of much that we value will inevitably follow whilst the public services and tax revenues of this country will be looted for offshore gain.

After that he will, of course, confirm h=commitment to destroying the NHS.

I strongly suspect he will announce Northern Ireland will be allowed a new 10% corporation tax rate - something that I am not at all sure would be legal. It will also cost the people of Northern Ireland dear in grants that are essential to their well being - but which will be foregone to make a tax haven within the United Kingdom. As indication of his real priorities this might be totemic.

Big business will, of course, get its tax cuts and they may be speeded up. And he will confirm that he is letting them move as much of their profit offshore as they want (given that after Vodafone HMRC has basically thrown in the towel in arguing with them). The new rules on controlled foreign companies will be one of the biggest tax cuts ever announced in the UK - simply by removing so much income from tax.

He may well announce plans to merge tax and national insurance - but don't buy the simplicity line. That's not what this is about. This can't be done without harming pensioners - who don't pay national insurance now. And the plan is, of course, to cut tax rates. The aim is to ensure that private medical insurance and reduced pensions become the norm. This is the backdoor route to destroying the welfare state - and delivering US style health care provision which costs twice as much as the UK and leaves 25% unprovided for. And nothing will be simplified as there will have to be a new payroll tax to replace NI - one tax in, one tax out then.

It's rumoured he'll help new home buyers. But subsidies just increase land prices. An empty property tax would force property onto the market and push prices down, whilst releasing what are in effect brown field sites for renovation. That's good news all round - except for those who hold such property for speculation. So why won't he do it?

And for small business there will be enterprise zones - which have only ever been used by tax avoiders and never by real entrepreneurs. At best they merely relocate what will happen anyway. At worst they provide a marketing opportunity for those selling tax avoidance.

Anything else? I'll welcome an increase in the personal allowance. But for those on the margin VAT increases and benefit cuts will have reclaimed it all already - £120 a year saved is nothing compared to the costs he's imposing.

This is a budget by a desperate man - desperate to get his destruction of UK public services in place before he's driven from office by the failure of his economic policies. We'll all pay the price for that.

Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:

You can subscribe to this blog's daily email here.

And if you would like to support this blog you can, here: