By Peter Hoskin
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Cameron’s speech on the economy today is a curious beast. Here we have the
Prime Minister pronouncing on growth, competition, debt and all that – but it has
a thin flavour to it, as though it’s just an appetiser for the Budget in a
couple of weeks. There are no new policy announcements, nor anything we haven’t
really heard before. Yet perhaps that is the point: Mr Cameron emphasises, à la Lady Thatcher, that “there
is no alternative” to the Coalition’s current plan. He speaks of consistency
and continuity. It reads like a message telling everyone – from the restless
Tory backbenches to Ed Balls and Vince Cable – not to expect a change in

that said, however, this is – by my
– one of the longest speeches that Mr Cameron has delivered on the
public finances and on the economy since the early days of his premiership. And
that means it’s worth taking a few notes. Here are five points I distilled from

i) The sunshine
has been dimmed.
Remember when, last
, Mr Cameron boasted that “the good news will keep on coming”? There’s
little, if any, such confidence in his voice now. The speech begins with a gloomy
account of what people are facing – “Some are just a paycheque away from going
into the red” – and it continues with plenty of warnings that “there is a long
way to go”. The PM does highlight some of the gains that have been made, such
as in the employment numbers, but the overall tone is very sombre.

ii) Themes
for the next election.
Soon after that line about paycheques, and others about bills and
children, Mr Cameron stresses that he wants to “back the aspiration of hard
working families who want to get on in life”. This is hardly a surprising thing
for a politician to say, but it also happens to sum up what – according to the
PM himself
, in conversation with the 1922 Committee – will be a major theme
of the Tories’ election campaign, in competition with Ed Miliband’s own pitch
for the votes of “squeezed middle”. Another theme that stands out from the
speech is Mr Cameron’s emphasis on global competition, and how Britain can keep
up with countries such as India and China.  

iii) The
downgrade: an inconvenient convenience
. Mr Cameron doesn’t shy away from mentioning
last month’s credit-rating downgrade – he uses it to bolster his argument. “Last
month’s downgrade was the starkest possible reminder of the debt problem we
face,” he says mid-way through the speech. And he highlights Moody’s warning
that they could downgrade us further were there to be “reduced political
commitment to fiscal consolidation”. It’s representative of the Government’s
strangely confident – and Labour’s strangely bumbling – response to the downgrade.
Indeed, Mr Cameron even goes so far as to say that, “dealing with the deficit
gives us the credibility in world markets to maintain low interest rates.”

iv) Hey, we’re
pro-growth, y’know.
Strikingly, the speech argues that the Coalition’s fiscal plans
are weighted to be pro-growth. “In spite of making difficult cuts,” says Mr
Cameron, “we are protecting the science budget and the money flowing to
schools.” He mentions infrastructure spending and his reluctance to see “big
increases in the taxes people pay on the money they earn”. This, I’m sure, is
to counteract any post-Budget claims – from Tory backbenchers, among others – that
the Government doesn’t have a plan for growth. But it’s not all about
self-defence. Mr Cameron also attacks New Labour for presiding over growth that
was “too dependent on unsustainable factors”. One of these factors happens to
be the theme of the week: “uncontrolled immigration”.

v) The
importance of the Bank.
Vince was talking about loosening monetary policy earlier. The FT
reports that George Osborne will talk about it, too, in his Budget speech. And
now Dave’s at it. “The Bank of England must support the recovery without putting
financial stability at risk,” says Mr Cameron in his speech. He talks of “what
I call, monetary activism”. It shouldn’t be forgotten that, with QE, the Bank
is already presiding over the biggest, most radical economic policy in town.
With the arrival of Mark Carney as Governor, the Coalition appears keen to
step that up.

go on then, here’s a bonus sixth point:

vi) Planting

Surprise, surprise – Mr Cameron attacks Labour for wanting to increase
borrowing. But less predictable is his use of the phrase “magic money tree” (as
in, “there is no…”) to bolster his attack; not once, but twice. It also crops
up, in spirit, in the Prime Minister’s assertion that the Coalition will not
implement “a tax cut paid for by borrowed money”. “Getting taxes down to help hard working people can only be done by taking tough decisions on spending,” he adds. Perhaps it’s not just Labour he
has in mind, after all.