An open letter to George Osborne: Dock the tail and give us our money back

With the budget next week and the tail frantically wagging the dog, isn’t time that the Chancellor looks to his roots as a Conservative?

The time is nearing, what'll it be, George?
Simon Miller
On 16 March 2012 09:00

Dear George

I know you will be very busy this weekend having taken a break to pop over to the States with David but I thought it would be an opportune time to ask you for a favour next week.

When you present your budget to the House, could you actually remember that a) you are not only the Chancellor but also a member of the largest party in the House of Commons and b) that you are meant to be a conservative.

For the past few months we have seen the Lib Dem tail frantically wag the dog ever more vigorously like a puppy that has got hold of a shoe. Now this may be politically convenient for you but it would be nice to actually see what a conservative government is actually doing when it comes to fiscal matters.

In a sleight of hand worthy of Gordon Brown you have so far managed to persuade the markets that there are indeed serious cuts going on under your watch but is that really true?

Let’s see how that public debt is going shall we? In the two years since you’ve come to almost-power, public debt has gone from  £1.05trn to £1.15trn and is expected to reach £1.29trn this year. That equates to £20,551 per person, a rise of £3,627in the past two years.

And the public spending? Ah yes, in this age of austerity we see that somehow you are forecasted to spend up to £703.4bn this year, an increase of £42.8bn up from when you took power.

Now, of course in an economic downturn you expect a rise in debt as incomes fall and social spending increase but, really? You call this austerity, and you allow the opposition within and without to lambast you for “savage cuts”? Welfare, education, and health have ratcheted up by around £5bn.

And yes the cost of borrowing is low but that was more to do with Zimbabwean economics rather than actual policy. What happens when the bond markets wake up to the card trick and find the old Lady of Threadneedle Street has been inflating the debt away while Number 11 keeps spinning about austerity?

If a government is spending it is spending our money, not theirs and if that same government is borrowing to spend, then that money will have to be paid back by us and our children, even our grandchildren if your ridiculous idea of 100-year bonds ever gets off the ground.

Well when I say us, I mean the tax payer. Although Ed gave a good spin on the idea of the squeezed middle, the reality is that the vast majority of all taxpayers are being squeezed and what will your big idea be George?

Reports suggest the tail is gracefully allowing you to scrap the 50 per cent tax bracket for high earners but only in return for a ‘minimum’ rich tax – whatever that entails.

Now I and others have argued that the 50 per cent tax actually loses money rather than produces it but I am sure that you will use the economic conditions and the warnings from the ratings agencies to say there is no money for the cut.

However, here’s an idea – why not pledge to cut the tax for all earners? Be it from the personal allowances, direct cut, or bringing back people to the nominal rate rather than the upper rate of tax.

Why not pledge that you will give the taxpayer his money back? Instead of making a person jump through hoops to get some of his money back through tax credits, reduce his monthly bill from your spendthrift departments.

Maybe even examine a flat tax structure?

As a Conservative it should be your duty to examine these things. Certainly as a Conservative is should be your duty to try and give us back our money rather than finding more ways of depriving us of it.

And there are things you can do immediately.

Bring about proper reforms to regulation, allow business to thrive in this country not choke on yet another gold-plated missive from civil servants whose idea for job creation is only their own..

What I want to see George is proper Conservative policies. Policies that will bring business over here, money over here, and employment to those that need it. We do not need glory projects like HS2, we need projects that bring us simpler regulation, better taxation and efficient spending in government.

It is not, as some ministers, say a matter of wittering on like some rabid right-winger, it is essentially good housekeeping.

All we have seen from this mess of a government is mixed messages where we must save for a pension but may find the tax breaks disappear, encouraged to save but find the government guaranteeing house loans for new builds which will only increase the house prices for those that are still locked out and those that will use another bubble to get themselves back in the credit funk they may have just worked their way out of.

George, remember you are a Conservative and if necessary dock the tail. We can get ourselves out of this mess but only if you act. If the civil service prevaricates, obfuscates and cannot bring about reforms that are desperately needed, get rid of them.

They are the servants, you are the managers, and you have to remind them of that. And you yourselves in that subsidised bubble of a place also need reminding, at the end of the day; we are the bosses that will decide on whether to remove you if you fail.

Simon Miller is the Editor of Financial Risks Today. He tweets @simontm71

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