Cameron Penny is a financial services lobbyist
Composed, confident and in command of his brief, the Chancellor talked for 50 minutes but there was precious little that we either didn’t know or couldn’t guess at. The big announcement, which had broken the night before, was that young people will have to work longer before claiming their state pension. Whilst self-evident to most people, the impact was only felt when the Chancellor actually made the announcement. It was a shrewd move and certainly gave some credibility to the mantra that this was a statement about the “long term.” The sums it will save are vast and the reform is long-overdue, given the rate at which life expectancy has increased. It also moves the state pension closer to what it originally was – a benefit intended for the elderly and the very poor. Let’s not forget that when Lloyd George first introduced the old age pension you had to be 70 years old in order to receive it. At that time, 50 per cent of the UK population died by the age of 60.
Opposite him, the Shadow Chancellor seemed to be doing an impression of Violet Beauregarde. You got the feeling that the Labour Party and its supporters deserved better. For the Chancellor had little room for manoeuvre and his announcements were hardly earth-shattering: a politically impossible fuel duty increase again postponed; £50 to the average householder by shifting green energy costs from bill payer to taxpayer, and there was £5m for the National Film and Television School’s “Digital Village”. Alongside this were a number of repetitions. The phrases “As announced at Spending Round 2013” appeared with alarming frequency, perhaps the Chancellor is convinced if he tells us often enough we’ll believe it will happen.
Yet still the Shadow Chancellor failed to land a punch. The danger for the Conservatives must now be that a concerted effort is launched to decapitate Ed Balls. He is currently one of our greatest election assets.
Thoughts must inevitably turn to what impact the Chancellor made. Whilst light on new policy, there were hints and nods in the direction of key voter groups. The announcement on pensions for example was obviously needed but he has carefully chosen to draw the line so that no one over 50 is affected. That should shore up support amongst the “grey vote”, which has historically turned out strongly for the Conservatives. In addition, there were also some surprisingly direct props to certain firms; £10m will go on testing driverless cars, which is a field Google currently leads, whilst bonus payments to employees of “indirectly employee-owned companies” will receive a tax exemption up to a £3,600 ceiling. It makes you wonder if John Lewis’ HR department will have to ward off another wave of speculative applications.
There were further nods to the audiences that the Chancellor needs to court with business rate indexation capped and an extension of Small Business Rate Relief. What we are witnessing now is a metamorphosis of George Osborne. He was taunted by Labour for being the “part-time Chancellor” whilst he formally held the title of election strategist along with his day job. What he has discovered is that he didn’t need the title in order to influence the outcome of the next one.