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Coffee House

Osborne’s choice: important projects or welfare

5 August 2014

8:54 AM

5 August 2014

8:54 AM

George Osborne can’t quite help himself. Today he’s continuing his Northern charm offensive, which has been impressively choreographed. He gave a speech back in June in which he said he wanted to create a ‘Northern powerhouse’, involving cities working together. Just a few weeks later, a group of councils in the North pops up with a plan to improve transport links across the region. Ta da! But the Chancellor couldn’t quite resist, when he was asked about the merits of this plan on the Today programme, making another strategic, political move, and linking welfare spending to the debate about regenerating the North. Asked what would happen if Treasury officials argued that London transport projects would deliver more value, he said:

‘I hope we don’t have to make a choice between the two. I think the real choice in our country is actually spending money on this big economic infrastructure, transpennine rail links, Crossrail 2 in London and the like, and spending money on, for example, welfare payments which are not generating either a real economic return and at the same time, are trapping people in poverty.’

The suggestion here is that the welfare bill is preventing other important projects, that it is a weight around the neck of the economy and damaging the North. It is indeed that, although the reasons for the ballooning welfare bill are a little more complicated than Osborne suggests: with housing benefit such a big part of that bill and indeed such a big driver of that bill’s growth, the choice isn’t just spend money on welfare or spend money on important projects for economic growth, but spend money on welfare or do something about the shortage of housing that is driving up the bill. To be fair to Osborne, he and allies have been pushing for a liberalisation of planning laws that would help with this, but without as much success as they’d hoped.

But Osborne’s interview today tells us two important things about the 2015 election campaign. The first is that the Tories are going to have a jolly good go at targeting the parts of the electoral map that are no longer their heartlands, rather than fighting a South-East focused campaign. The second is that increasingly we will hear these binary choices between welfare and Important Projects, even if they’re not quite fair or accurate. The problem for Labour is that complaining that such contrasts are not fair or accurate falls on deaf ears: the reason George Osborne is presenting the choice in this way is that it is very popular with voters.

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