Hat trick of good news just out from ONS: GDP revised up, consumer confidence up, living standards up. #LongTermEconomicPlan working
— George Osborne (@George_Osborne) March 31, 2015
All hail OLTEP (Our Long Term Economic Plan). So tweeted the Chancellor this morning in response to the latest growth and living standards data from the ONS. He’s understandably happy – not only do the headline figures on GDP and disposable income suggest people are better off, but the data also shows a rise in people’s perception of how well off they are. Here’s the chart:
This is an encouraging answer for those Conservatives who’ve been worrying about the gap between statistics and belief. Just because people actually are better off than they were five years ago, doesn’t necessarily mean they believe that to be the case – five years is a long time, memory isn’t always perfect and we can be very subjective creatures. That the perception numbers are ticking up is a good sign.
But overcoming that concern leads us to another, more tricky question. Even if people a) are better off and b) believe themselves to be better off, does that mean they c) attribute that improvement to the government of the day? In other words, how do you convert numbers and feelings into votes?
Claiming credit for economic improvements is difficult for any government. But it’s particularly hard for Conservatives, who rightly emphasise that jobs aren’t created by the state, they’re created by private enterprise – the only thing politicians can do is to create the conditions in which business can flourish.
It’s notable that Tory rhetoric has shifted subtly in the last couple of months – where the line used to be that 1.9 million jobs have been created, I’ve noticed more and more often spokesmen saying “we’ve created” 1.9 million jobs. Presumably the betting is that this language will forge a stronger link between economic improvement and OLTEP in voters’ minds. Aside from the excitement of slip-ups, the controversy over what colour everyone’s van is and which reality star Nick Clegg might be meeting (and why, for that matter), it’ll be the daily battle to build that link that ultimately decides the election.
As an aside, albeit on a related topic, Labour’s struggle for a shred of economic credibility continues to get harder. I noted last week that the election will see the Parliamentary Labour Party become distinctly more left wing. Yesterday, John McDonnell confirmed this prediction in the New Statesman, saying that an expanded block of hard left MPs would “inevitably” force a Miliband government to abandon even “austerity-lite”. While the Conservatives’ overall standing on the economy matters, so does the gap in credibility between us and Labour – and the opposition are only heading in one direction.