It is tweeted anyway, and especially every time the gold price hits a new high, that Gordon Brown lost the taxpayer billions by selling the national reserves of gold in 1999-2002. However, the corollary of this argument may be that George Osborne should have bought the gold back in May 2010 – it need not have cost him anything because he could merely have speculated in the gold futures market. PFI is another classic example. While originally ‘invented’ by John Major, the adoption of the accounting used in PFI accelerated under Labour. Indeed in April 2011, it was reported that George Osborne has pressed ahead with PFI projects on a multibillion-pound scale despite having dismissed the infrastructure funding mechanism as “discredited” when he was in opposition. A report on Channel 4 News at the time showed 61 PFI projects, worth a total of £6.9bn, have been taken forward since the general election. This is despite claims that private sector borrowing costs currently make PFI particularly poor value for money. Of course, all political parties tend to put a positive spin on their own particular messages, as Alastair Campbell and Craig Oliver well known, but when the situation becomes that the public cannot trust the media so much, that is when democracy becomes dangerous.
The question of how Labour, and indeed all political parties, have lost support has been progressing gradually over the ways, at probably much at the same rate as the decline in official circulation of print newspapers. People are possibly, however, engaging with “real issues” in private on the social media instead. It cannot be argued, although many people do, that part of the ‘disconnect’ between Government and its electorate has resulted from the Government enacting whatever it wants without an electoral mandate; this is the public perception, for example, of the abolition of PCTs or the enactment of the Health and Social Act (2012) in general. When I attended the fringe meetings at the Labour’s annual conference held in Manchester las year, a statistic kept re-occurring, that during the party’s 13 years in power it lost five million votes. In the Blair landslide of 1997, 13.5m people voted Labour. By 2010 the figure was down to 8.6m.
Over the Christmas period, Lib Dems were urged to spread the message that their Conservative coalition partners “can’t be trusted” to look after normal people rather than the super-rich. A leaked script of the party’s lines to take in the media apparently urged MPs, candidates and councillors to say that only the Lib Dems are committed to building “a fair society”.
The massaging of the truth, rather than genuine and truthful message, is entirely relevant to how Labour can reconnect with some of the potential electorate. Peter Kellner’s analysis provides some helpful information regarding how Labour and Liberal Democrat support have changed recently
“These numbers suggest that many defectors, though not a majority, opted for a left-of-centre alternative to Labour. However, Labour has already won most of these back. This autumn, the number of people who backed Labour 15 years ago but would vote Lib Dem today has slumped from two million to just 300,000. The vast majority who defected to the Liberal Democrats in 2010 have returned to Labour. The party now needs to hold onto them, but the initial reconversion has already taken place. Nevertheless, the total number of remaining defectors stands at three million. That’s still a large group; indeed, it’s ten per cent of the 30m people who are likely to vote at the next election. If Labour can win even half of them back, it will give the party a cushion against any revival of fortunes for the Conservatives and Liberal Democrats.
Conservatives latterly have been demanding how the opposition must be “much stronger”, even while it is claimed that they have lost a nearly quarter of their voter base in the last year. The media have elected in general not to cover important issues such as the NHS reforms, or the legal aid reforms affecting the closure of law centres on the high street (while covering in vast detail Abu Qataba). There have been a number of noteworthy examples, however, of where untruths have been spoken, either innocently, fraudulently or negligently. It could be that the impact of each of them is pretty negligible, but when taken as a whole may confirm the general perception of this government being a permanent omnishambles (elegantly referred to, by Isabel Oakeshott, once as “permishambles”). It cannot be good for democracy, whatever the effect at the ballot box, that such massive “whoppers” have been spoken. They might reflect a lack of care by the people producing these alleged false statements, but could equally reflect a complacency that they would be unnoticed by other parts of the media which have become increasingly critical, perhaps in reaction.
Revealed: how Osborne manipulated the borrowing figures
Against expectations, George Osborne announced in his Autumn Statementthat borrowing would fall, not rise, this year. The news cheered the Conservative backbenches and clearly surprised Ed Balls, who was jeered by Osborne and David Cameron as he mistakenly said the deficit was “not rising” (he meant to say it was rising). Borrowing so far this year is £5bn (7.4 per cent) higher than in the same period last year – it seemed there was no escape route for the Chancellor.
So how did he do it? Well, turn to p. 12 of the Office for Budget Responsibility document and it becomes clear that Osborne has performed an accounting trick worthy of Enron. First, he added the expected £3.5bn receipts from the 4G mobile spectrum auction – even though it’s yet to take place. Second, he included the interest transferred to the Treasury from the Bank of England’s Quantitative Easing programme (worth £11.5bn), despite the Institute for Fiscal Studies warning him that it would call into doubt his credibility. Were it not for these two measures, borrowing would be £15bn higher than stated by Osborne. If we add that £15bn to the £108bn figure provided by Osborne, then total forecast borrowing for this year becomes £123bn, £1.4bn higher than last year. Little wonder that the Chancellor was so keen to bag the 4G receipts early.
But while these fiscal somersaults might allow Osborne to claim he’s reduced borrowing, what reputation he had for statistical transparency has been destroyed. In his speech to the Commons, the Chancellor boasted that “it is a measure of the constitutional achievement that it is taken for granted that our country’s forecast is now produced independently of the Treasury”. That claims looks very questionable today.
David Cameron ordered stop saying NHS spending is up
Mr Hunt, the Health Secretary, should “clarify” claims that expenditure on the NHS had risen in “real terms” every year under the Coalition, the UK Statistics Authority said. The chairman of the authority, Andrew Dilnot, issued the rebuke after upholding a complaint by Labour about statements by the Prime Minister and other senior Tories. Labour demanded that Mr Cameron correct his “misleading boasts” about protecting NHS resources. Mr Dilnot’s letter will be a blow to Mr Cameron, who repeatedly promised to protect the NHS in the run up to the last general election and in numerous public statements since. The health service is seen as one of the Conservatives’ most vulnerable policies after sweeping reforms to the structure of the NHS met with widespread opposition from medical professionals. The reforms eventually became law earlier this year, but only after a bruising fight that forced an unprecedented “pause” in the progress of the Bill through Parliament.
Finally! Exposed! The deficit myth! So, David Cameron when are you going to apologise?
The last government left the biggest debt in the developed world. After continuously stating the UK had the biggest debt in the world George Osborne admits to the Treasury Select Committee that he did not know the UK had the lowest debt in the G7? Watch Also, confirmed by the OECD Those who use cash terms (instead of percentages) do so to scare, mislead and give half the story. It’s common sense, in cash terms a millionaire’s debt would be greater than most people. Therefore, the UK would have a higher debt and deficit than most countries because, we are the sixth largest economy. Hence, its laughable to compare UK’s debt and deficit with Tuvalu’s who only have a GDP/Income of £24 million whilst, the UK’s income is £1.7 Trillion. Finally, Labour in 1997 inherited a debt of 42% of GDP. By the start of the global banking crises 2008 the debt had fallen to 35% – a near 22% reduction page 6 ONS Surprisingly, a debt of 42% was not seen as a major problem and yet at 35% the sky was falling down?
Osborne’s claim that the deficit is down by a quarter is just plain wrong.
“The deficit is down by a quarter.” This is not true. No, that’s being too kind to George. That’s a lie. [We have the data] based on budgets from 1998 to 2012 on the current surplus and deficit on spending on and total borrowing (which includes the cost of investment) for the last 15 years, plus projections to 2017. The figures to 2011-12 are pretty reliable: after that they’re made up. We now know that 2012-13 is now going to be at least as bad as 2011-12: currently borrowing is higher. The deficit reached £156 billion in 2009-10. But that was because Labour spent to make sure that the worst impacts of the crash were beaten off by Keynesian policies that ensured that the economy was growing when they left office. The deficit for 2011-12 was £126 billion, subject to revision either way by a billion or so. This year it will be worse. That’s a 19% improvement on 2009-10. But it’s been done at a cost in terms of investment,
Factcheck: Is Britain a tax credit haven?
Iain Duncan Smith has had a long hard go at Labour for their welfare spending. Not for the first time, he says hard working taxpayers are paying for the big-spending ways of the last government. This time, he’s got the tax credits system in his sights. The current – though not for much longer – system was introduced by Labour as a way of bringing down child poverty. Instead, the work and pensions secretary wrote in the Daily Telegraph today: “It tells a sorry story of dependency, wasted taxpayers’ money and fraud.”
“Tax credit payments rose by some 58 per cent ahead of the 2005 general election, and in the two years prior to the 2010 election, spending increased by about 20 per cent.”
We asked the Revenue and Customs (HMRC), which administers work and child tax credits, how much has been paid out since the current system started under Labour in 2003 (before that it was the Working Families Tax Credit). It said that in 2003-04, £16.4bn was paid, and the following year – the one that included the general election to which Mr Duncan Smith refers – £17.7bn. That’s an increase of 8 per cent, not 58.