George Osborne says he'll keep on going — but will the Lib Dems follow?

By Peter Hoskin
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Judging by the words drifting from the conference stage this morning, the Tories are eager to cause a bit of intra-coalition mischief over business policy. First, in the run-up to George Osborne’s speech, Amber Rudd introduced Michael Fallon as the “real Business Secretary”. And then Mr Fallon went on to describe a “lesson for Labour and even the Liberal Democrats: instead of thinking up new taxes, get behind British business…”

Yet it was the Chancellor’s speech that would really have made Lib Dems gag and choke. This wasn’t because it contained little cracks at their expense — it’s didn’t; Mr Osborne even made sure to praise Danny Alexander within seconds of taking to the stage. It was because it revolved around those big policy statements that we heard yesterday, and which many Lib Dems supporters will loathe. That £10 billion-worth of further welfare cuts is now a goal, not just an idea for general floatation. And there will be no mansion tax or wealth tax in return for them.

So what are the Lib Dem leadership going to do? Will they acquiesce, is a way that they once suggested they wouldn’t? Well, in truth, they have been cooling their opposition to the £10 billion of cuts for a few weeks now. But, in the immediate aftermath of Mr Osborne’s speech, there is also some doubt about whether they will actually sign up to the policy. If compromise is to come, it is probably to be found in the Chancellor’s line that “those with the most should contribute the most”. Not a wealth tax, but — who knows? — perhaps that persistent chestnut: more action against tax avoiders and evaders.

Of course, the £10 billion of extra welfare cuts is tremendously important not just for Coalition relations, but also for the Tories’ message going into the next election. It could be a tough sell, but Mr Osborne’s speech suggested how it would be done: by emphasising the party’s determination to “finish the job we have started” and by pointing to the injustices and inconsistencies that exist in a benefits system, and culture, that has yet to be fully fixed. We’ve heard these lines before, but they seemed to be better delivered today. Mr Osborne talked about people — albeit abstract people; dockworkers, nurses, schoolteachers — more than he usually does. And his tone was unfussy and confident.

There was confidence, too, in Mr Osborne’s defence of the 50p tax cut (“getting rid of a crippling 50p rate that raised no money and cost jobs”) and in his attacks on Ed Miliband (“it is risible to think that you become a One Nation politician by repeating the words over and over”). I’m still keen to her a more considered response to Mr Miliband, but it might be being saved for David Cameron’s speech on Wednesday. Besides, the jokes and jibes all acted as preamble for Mr Osborne to exclaim “Workers of the world unite!” when announcing his new scheme on workers’ shares and job rights.

In the end, this was not a surprising speech that put forward lots arguments and ideas we aren’t already familiar with — it was a form of story, yet a fairly well-told one. Those hunting for growth policies had better keep on waiting for the day of the Autumn Statement. That’s the Osborne speech that really matters.

P.S. As an addendum to Matthew's post, here's an photo a postcard that was being handed out after Osborne's speech. Much is being made of the 25 per cent cut in the deficit, no doubt partially to nullify Labour's claims about "rising borowing":