When she spoke today the Chancellor was keen to emphasise to MPs how much 'the world has changed'. In a sense she is correct. Just one year ago the UK was the fastest growing economy in the G7 and inflation was down to just 2%.
Today things are very different: growth forecasts have been halved; inflation will be running at twice the level as was forecast for 2025 and unemployment will be rising this year and the next two years as well.
The saddest thing about these grim figures is that they are entirely of the Chancellor's own making. It was her and her Treasury team that spent months talking down the economy to the point that business confidence all but collapsed. It was the Chancellor who concocted the fiction of a £22bn black hole in public finances - and it was the Chancellor who, at the last Budget, embarked upon a reckless programme of borrowing, taxation and spending of the sort not seen in this country for almost 50 years.
The result is what we saw today - but I know that the lamentable sight of a Chancellor having to grapple with the consequences of her own actions will do nothing to comfort the many businesses in Reigate, Redhill, Banstead and our villages still facing ballooning tax bills; the jobseekers seeing their opportunities smothered by unmanageable NICs rises or all those who work with or depend upon our outstanding local charities wondering if these will survive the year.
Shockingly, nothing I heard today so much as suggested that the Government are open to changing course on either taxation or employment laws and I fear that accordingly the economic picture will remain bleak. What we did have confirmed today is that the Government refuses to reinstate Winter Fuel Payments; refuses to reverse the Family Farm Tax; refuses to stop their disastrous hike to National Insurance - and worst of all, refuses to make hospices looking after the terminally ill exempt from their tax rises.
If there was a bright spot today, it was certainly the confirmation that defence spending will reach 2.5% of GDP by 2027 - this is something the Conservative Party has been championing in opposition and becomes more pertinent with each passing day. With that said, even here the Government is suffering from a dearth of ambition. We do live in extremely uncertain times and so the ultimate 3% target should urgently be brought forward to this Parliament. The Chancellor offered no explanation of how this could be achieved in the event that the security environment in Europe further deteriorates.
Finally, the Government's welfare reforms have draw much comment in recent days. We have an example of what positive welfare reform looks like - it is what was implemented by the last Conservative Government. Our approach led to £5 million of savings across the forecast period, and saw 450,000 fewer people going onto long-term sickness and disability benefits as a direct consequence.
By contrast Labour's announced reforms have been hurried, lacked a clear sense of direction or purpose and had no democratic foundation. There was no mention of the personal independence payment in the Labour party manifesto, and yet when the Chancellor was forced to find extra savings to cover the fallout from the Autumn Budget, drastic cuts were made out of the blue. As the Shadow Chancellor observed, we have gone from incompetence to chaos.
Regrettably, this will likely not be the end of the downward economic spiral we are seeing with the current Government - I am extremely mindful of the fact that the inevitable negative impact from Angela Rayner’s ill-concieved Employment Rights Bill has not yet been factored into any future projections!
