Last October at the Tory Conference in Birmingham George Osborne told the British people that the cupboard was bare.  Back in Birmingham later today he will issue more "uncomfortable truths":

"“Britain is going to have to work hard and save hard to get out of this hole. The Conservatives are ready to tell people these home truths, and the country is ready to hear them.”

"It means telling people that they can’t rely on massive increases in house prices to fund their retirement, and that they will have to save for a deposit to buy their own home. It means pointing out that increasing profits through ever-higher debts is not a sustainable way to build a business."

The FT reports that the Shadow Chancellor will "signal a rebalancing of corporation tax to remove an incentive for companies to borrow." It continues: "He is considering fiscally neutral reforms to end the system of offering tax rebates for debt but not equity finance."

You can read the speech in its entirety here.

ConHome welcomes the candid warning of hard times ahead but, in due course, George Osborne will need to say much more.  He doesn’t need to do so now because times are still evolving and the scale of the readjustment is also therefore unknown.  Honesty about our intentions in government may reduce the scale of the Conservative victory but it will give us a much stronger mandate to start putting Britain right.

Tim Montgomerie