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Matthew Hancock is Conservative MP for West Suffolk and was Chief of Staff to George Osborne until shortly before the last General Election.

Choice2

Yesterday’s press conference by Ed Miliband and Ed Balls revealed a central truth about the Labour opposition.

Not just the highly insensitive attempt to score a political point from the tragedy in Japan.

Nor the admission from Ed Balls that the banking regulation he wrote helped cause the mess we are in.

More than these, yesterday’s press conference showed the Labour have chosen short-term populism and empty opposition over any serious attempt to restore any economic credibility. It will cost them dear.

Let’s take three examples, from little to large.

The first, and most incredible, is Ed Balls’ latest policy wheeze. He says he wants to use the money raised by the coalition’s increase in the bank levy to cut VAT on fuel by 2.5%.

It might have sounded good when he dreamed it up. But it lacks any credibility. The proposal to raise the money is a one-off, while the promise made costs every year. Labour have already promised to spend the money ten times over, on extra capital projects, lower child benefit for the better off, tax credits for the lower paid, and deficit reduction. And the proposed change to VAT is illegal under EU law.

Battling with this proposal is like attacking a many-headed beast, as it has so many flaws to expose.

Balls retorts that Ken Clarke cut VAT on domestic fuel in 1995. But under EU law domestic fuel is treated differently to road fuel. Unlike on road fuel, a lower rate of VAT on domestic fuel is legal.

Labour negotiated these EU rules. Balls knows the EU law. He is making a ridiculous argument because he thinks it sounds good – even though he knows it’s nonsense.


The second example is bank taxes.

Yesterday Ed Balls and Ed Miliband called for a repeat of Darling’s bonus tax. But Darling himself says it wouldn’t work again. The Eds have no answer. Instead they repeat an absurd argument that the Coalition has cut taxes on banks, when in fact taxes on banks have risen – again according to Alistair Darling.

Just like with fuel, the two Eds make a ridiculous argument because they think it sounds good – even though it’s nonsense.

Finally, and most importantly, on the big picture. The whole Labour front bench attack any cut, and pretend they would not make them. Yet Darling’s plan, to which the Eds are signed up, proposed £14bn cuts in the year from this April, just £2bn less than the coalition.

Instead of proposing a credible set of their own cuts, they oppose almost every saving put forward by the Coalition, and loosely promise to reverse anything they particularly dislike. But then, when under pressure, they admit that they cannot in fact do anything differently.

Miliband said: “"I can make no commitment to do anything differently”.  Balls went further: “Ed Miliband and I are clear on this; no commitments to reverse these changes, they would be irresponsible”. So, hold on. With all these cuts, all this noise, all these headlines, all these policy launches, Labour can “make no commitment to do anything differently.” Why, then, should we listen to a word that any Labour frontbencher says? After all, they can make no commitment to do anything differently.

The path Labour chose yesterday is the path of empty opposition, not the path of the credible alternative.

On the other side, the Government is embarked on radical reform. It is difficult now, as each vested interest makes their voice heard. But they are dealing with a huge number of long-standing problems in the national interest: a record deficit, reforming welfare, education, health, pensions, the police, supporting enterprise, and taking millions out of income tax. These reforms are not easy. The benefits will be felt over time.

But the contrast is stark between the empty opposition of Labour, and the Government taking on the difficult challenges we face.

We must take every opportunity to expose the choice each side has made.

I know which side I’d rather be on.

50 comments for: Matthew Hancock MP: The divide in British politics is now clear

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