Improving the supply of new housing, adjusting the Help to Buy scheme if necessary, revaluing council tax bands and accepting that universal credit won’t solve all of Britain’ welfare ills: all ideas batted around in domestic political debate in this country by politicians and commentators who manage to secure a reasonable hearing each time they suggest them. But the problem with this latest list is that it comes from the European Commission: poorly supported by last week’s European elections and not preaching from a position of runaway economic success.
The EC has published recommendations for each EU member state which are ‘designed to strengthen their growth potential, increase competitiveness and create jobs’. The specific recommendations for the UK, which you can read here, can be summarised thus:
– Cut the deficit in a sustainable manner.
– Prioritise capital expenditure.
– Broaden the tax base.
– Improve access to finance for SMEs, and address ‘structural bottlenecks’ for infrastructure and skills mismatches.
– Make the regulation of the housing sector by the Bank of England’s Financial Policy Committee more transparent.
– Adjust the Help to Buy scheme to deal with rapid rises in house prices.
– Revalue council tax bands.
– Increase the supply of housing.
– ‘Maintain commitment to the Youth Contract’ and ‘reduce the number of young people with low basic skills’.
– Ensure Universal Credit delivers adequate benefits and clear work incentives.
– Improve the affordability of childcare.
– Ensure the National Infrastructure Plan is working.
How seriously the government will take these recommendations is made clear rather neatly in this fabulously pithy Treasury response:
‘As one of the fastest-growing economies in Europe, we always listen to the Commission’s recommendations with interest.’
The government has faced down scarier critics than this, such as the IMF, which now supports the UK’s economic plan. But that the Treasury can so effectively dismiss the Commission and that the story emerging from these recommendations is not ‘Osborne in trouble again’ but ‘arrogant eurocrats lecture UK’ shows how far ministers have travelled over the past few years.
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