‘It’s the economy, stupid’

LICENCE TO CUT:  Osborne is intent on making the most vulnerable pay for an economic crisis caused by the banks

LICENCE TO CUT: Osborne is intent on making the most vulnerable pay for an economic crisis caused by the banks

by Colin Fox, SSP national co-spokesperson George Osborne’s Budget acclaimed UK economic growth of 2.5 per cent last year, record employment levels and low interest rates. Designed to win the Conservatives a second term in Government he dispensed with tradition and avoided increasing duty on alcohol, tobacco, or fuel.

His message to the UK electorate was that the Tories, having inherited an economy deep in recession and deep in debt, had managed to turn the situation around and secure the second highest growth rate in the Western World.

‘But we still have a long way to go’ he insisted warning his plans for further cuts in public spending were the worst yet. It would be ‘No more Mr Nice Guy’ he inferred as he ‘needed another term to finish the job’.

The question that inevitably arises from George Osborne’s apparent success is why are the Tories not streets ahead in the polls then? Might the answer be that this growth is again based on a highly problematic South East of England housing bubble and it’s associated borrowing?

Might it not also be said that most of the new jobs created are casual, on zero hour contracts and lowly paid? And since the average worker is now £1,800/year worse off than they were in 2010 isn’t each household’s economic standing in stark contrast to the picture he paints of UK PLC?

These are of course rhetorical questions. With prices having gone up as wages have fallen Britain is now suffering significant deflationary pressure. Most people do not have the money to buy the things they want and that is dampening economic growth.

The fact interest rates are at such a historic low reflects this economic reality. The Tories are not going to win the election insist the pollsters because voters do not feel Osborne’s recovery themselves. Rather they see their own standard of living falling year after year.

Given such widespread economic discomfort why is Ed Miliband not streets ahead in the polls? Good question. The answer is that Labour has not been forgiven for its own economic incompetence in getting Britain into the 2008 debt-ridden recession in the first place.

Furthermore, its proposed economic solution involves making the same deflationary cuts and implementing the same austerity measures as the Tories. That then in a nutshell explains why bookmakers have installed ‘No overall majority’ as the 1/7 favourite as the most likely outcome of the 7 May General Election.

The SSP’s ‘alternative budget’ would have emphasised the need to reflate the economy and reduce growing inequalities in Britain today by, for example, introducing a £10/hour living wage and abolishing zero hour contracts.

The Government admit you need to be earning £10/hour in order to pay your own way today and stop qualifying for top-up benefits. That then is rationally the level at which the living wage should be set.

Osborne and Ed Balls are intent on making the most vulnerable pay for an economic crisis caused by the banks. The SSP rejects that criminal conclusion.

Our ‘alternative budget’ would move to solve the chronic shortage of affordable housing in this country. We would build 100,000 new homes in Scotland each year to alleviate the appalling pressure on local authority waiting lists, to deflate the speculative and harmful house price bubble and provide much needed jobs for construction workers.

This issue was brought into sharp focus again last week when the Scottish Federation of Housing Associations Annual Report announced they had demolished more houses than they built in 2013/14.

There are hundreds of thousands of families living in accommodation unfit for their needs. There are also tens of thousands of under-employed construction staff.

Building quality public homes for rent is therefore a far better solution to the nation’s housing crisis than leaving it to speculators who leave more and more people behind in desperate need of a satisfactory place to live.

As well as introducing a £10/hour living wage and launching a massive public sector house building programme we would also cut class sizes, introduce free school meals, introduce free public transport to address climate change and improve accessibility and replace the Council Tax with an income based alternative.

These measures would be paid for by increasing taxes on the well off, clamping down on tax evasion and avoidance, introduce a ‘Tobin Tax’ on financial transactions and of course re-deploy the £100billion earmarked for Trident II.

Our manifesto for the forthcoming General Election setting out all these policies in more detail will be available in the next few weeks.

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