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The target of the IFS's fairness report isn't George Osborne. It's Nick Clegg.

By Paul Goodman

Screen shot 2010-08-25 at 08.54.22 The Guardian attempts this morning to rewage a political war of the 1980s by leading on the budget, and its effects on poorer people.  The paper attempted during the 1980s to rob Margaret Thatcher of moral legitimacy by claiming that she was deliberately lowering their living standards - hoping, in consequence, that she'd be toppled at the polls.  Its push was a business success - though the Guardian's sales (like everyone else's) fell, it tightened its grip on public sector advertising - but, at the time, a political failure.  Mrs Thatcher won three elections, and John Major a fourth.  Only in his time did the paper score a big victory, in its court battle with Jonathan Aitken and its wider reporting of "sleaze".

None the less, the charge of being uncaring (as well as incompetent) haunted the Party for 13 years.  This helps to explain both the language and content of George Osborne's budget.  Its last announcement (and the final sentences of a budget speech always try to set its political tone) was an increase in the child element of the child tax credit, the part of the payment that benefits the poorest most.  "It is a progressive Budget," the Chancellor declared a few moments later.  "And we have done all this," he concluded of his measures, "without increasing child poverty...The richest paying the most and the vulnerable protected. That is our approach."

But there's more to the Guardian's story this morning than an attempt to revisit the 1980s.  After all, this a Coalition Government, not a purely Conservative one.  The junior partner is vulnerable, with its poll ratings plummeting and a testing party conference looming.  The Liberal Democrats have bet the farm on "fairness".  Nick Clegg has insisted that the budget was fair, and Vince Cable has elevated "fairness" to the test of whether he'll support the Coalition.  The aim of big parts of the left is, in the short term, to put pressure on Nick Clegg at his conference and, in the medium term, to get the Liberal Democrats to pull out of the Government.

Osborne, then, faces three challenges on the fairness front.  Namely, to - 

  • Defend the budget.  The Treasury says that the document (specially commissioned by the End Child Poverty campaign) is "selective, ignoring the pro-growth and employment effects of budget measures such as helping households move from benefits into work, and reductions in corporation tax".  The IFS itself doesn't say that child poverty will definitely rise - the Guardian lacks the quote which the Independent supplies to that effect - and the IFS gives the report no prominence on its own website.  But the Government shouldn't simply sit back, and wait to be attacked about fairness.  It must get back on the front foot in relation to the issue, as did during the budget itself.
  • Advance its record.  The Government's already produced solid plans to help poorer people, such as protecting the poorest workers from public sector pay restraint, aiming tax cuts at earners on lower incomes, and paying children from poorer families a pupil premium.  And better-off people look to lose from a crackdown on "middle class welfare", and not gain from some tax cuts, such as the proposed transferable allowance for married couples, which will be restricted to the income tax standard rate.  They'll also, of course, bear the burden of the tax rises which aim to help pay off the deficit.
  • And most importantly of all, promote its social justice programme - much of which which is Conservative. It's important for the Government to make its case on the "fairness" front.  But "fairness" is as hard to demonstrate as it is simple to proclaim.  The IFS study is a case in point.  Is "fairness" proved by examining tax and benefit changes alone, or by also taking into account the wider effects of Government policy - such as its welfare-to-work programme?  The Coalition - and particularly the Tory part of it -  should do more than get bogged down in the trench warfare of rebutting its opponents point by point (vital though that task is).  It must also continue its raid behind enemy lines - making the case for social justice built up in opposition by Iain Duncan Smith at the Centre for Social Justice and by Michael Gove in his education brief.  The big picture - getting right-wing policies to deliver progressive aims - matters as much as the detail.


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