Taking Britain Backwards - Autumn Budget 2017

Philip Hammond
The Chancellor of the Exchequer, Philip Hammond

Philip Hammond attempted to shrug off the huge divisions in the Tory Party by cracking a few jokes as he delivered his second Budget since becoming Chancellor, but the biggest joke was the portrayal of himself as a great moderniser putting Britain ‘at the forefront’ of the world’s imminent ‘technological revolution’. He said the Conservatives would ‘run towards change’ and make Britain ‘fit for the future’. The grim reality is markedly different. Barnaby Philips reports.

  • The Resolution Foundation said that wages would not return to 2008 levels until 2025, meaning two lost decades of wage growth for workers, the longest fall in living standards since records began in the 1950s.
  • The state sector continues to be stripped to levels not seen since the 1930s under the plans of the previous Chancellor, George Osborne.
  • The Office for Budget Responsibility (OBR) announced its biggest downgrade for economic growth since it was set up in 2010. Growth in 2017 was reduced from 2% to 1.5% and growth through to 2021 was knocked down by between 0.2 and 0.5 percentage points; it will only creep back up to 1.6% in 2022. Even these figures are optimistic as they ignore the uncertainty of Brexit and the increasing probability of recession – Britain has suffered one in every decade since the 1970s.
  • GDP per person will be 3.5% smaller in 2021 than forecast in March 2016. The loss of growth will mean the economy is £65bn smaller in 2021 than previously thought.

Despite seven years of austerity that was supposed to eliminate the budget deficit, originally by 2015, the Tories have been forced yet again to increase borrowing. The OBR rejects Hammond’s assertion that the hole in the public finances will be gone by 2025, saying it would remain until at least 2031. The Institute for Fiscal Studies added that national debt – currently standing at £1.94 trillion, with an annual servicing cost of £48bn – may not return to pre-crisis levels until the 2060s.

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Brexit: Ruling class divisions entrenched as negotiations begin

The split in the Conservative Party which brought about the EU referendum has become an open wound since Brexit negotiations began in June. The ‘hard’ Brexiters in control of the government are not prepared to entertain talk of a transitional period after the March 2019 deadline that would push back the end of free movement and withdrawal from the Customs Union and Single Market. They harbour fantasies of an independent British imperialism that is simply no longer possible. Barnaby Philips reports.

The Brexit debacle is a manifestation of the deepening capitalist crisis and intensifying inter-imperialist rivalries. British imperialism’s relative decline1 forced its ruling class to make a decision it did not wish to make: become a junior partner of US imperialism or forge an imperialist bloc with Europe. With the US facing its own acute crisis under the presidency of Donald Trump, it is easy to see why much of the ruling class is determined to secure a ‘soft’ Brexit that would retain access to the Single Market and the Customs Union.

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Spring Budget - Dismal prospects for an unequal, divided Britain

spring budget

The change of Chancellor and the decision to leave the European Union (EU) did not alter the timeworn formula underpinning the Budget speech. As usual there is little correlation between the exaggerated claims for the state of the British economy and the stark, grim reality of millions more working class people driven into low-paid jobs, confronting failing public services and increasing poverty. David Yaffe reports.

On 8 March, in his first Budget speech, Chancellor Philip Hammond spoke of a British economy that ‘has continued to confound the commentators with robust growth’; which ‘delivers further investment in our public services’; ‘extends opportunity to all our young people’; has ‘a labour market delivering record employment’, and ‘a public sector deficit down by over two-thirds’ as it ‘continues the task of getting Britain back to living within its means’. It is an economy, he said, that provides ‘a strong and stable platform’ for Britain’s negotiations to exit the EU while ‘building the foundations of a stronger, fairer, more global Britain’.1 The reality is markedly different.

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In-work poverty in Britain hits record high

Durham teaching assistants

In imperialist Britain, the sixth richest country in the world, the number of people afflicted by in-work poverty has hit a record high. One in every eight workers, 12%, lives in poverty, exposing as lies six years of cynical pledges from the Conservative Party to ‘restore the link between hard work and reward’. The government’s real agenda has been to divide and rule by attempting to drive a wedge between ‘strivers’ and ‘scroungers’. But as an annual state of the nation report conclusively shows, for the poorest sections of the working class in Britain, the working and the unemployed are equally tormented by the rule of capital. Barnaby Philips reports.

Published on 7 December 2016, the Monitoring Poverty and Social Exclusion 2016 report,* written by the New Policy Institute on behalf of the Joseph Rowntree Foundation, revealed that the number of working people living in poverty in 2015 increased to 7.4 million, up from 6.3 million in 2010. This represents a record high of 55% of the overall 13.5 million of the population living below the official poverty line. The vast majority – four-fifths – of the adults in working households are employed, some 3.8 million workers. The remaining fifth predominantly look after children.

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The gig economy: new name for old exploitation

Deliveroo drivers strike

The increasing casualisation of employment, along with new online platforms for marketing labour and goods, have generated new terms which are celebrated, debated and decried by politicians, commentators and journalists. Central among these is the ‘gig economy’ – where self-employed workers are paid mainly by individual jobs or ‘gigs’ performed, with jobs often communicated through a smartphone app or website. Despite the supposed empowerment at the heart of this model, exploitative big businesses – such as delivery company Deliveroo and taxi firm Uber – have become emblematic of the gig economy. Workers usually have few employment rights, but resistance has begun, with Deliveroo drivers organised in the International Workers of Great Britain (IWGB) union demanding union recognition, and a recent employment tribunal ruling on 28 October that Uber cannot categorise its drivers as self-employed, and must pay them the national minimum wage. The gig economy is a vague concept which links loosely into wider casualisation – notably the rising use of zero hours and temporary contracts in fields such as care work, retail, catering and, increasingly, higher education. Luke Meehan looks at what the gig economy means for capitalists, workers, and resistance.

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