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George Osborne’s Autumn Statement in 12 graphs

3 December 2014

6:15 PM

3 December 2014

6:15 PM

George Osborne had dismal figures today, and still managed to present them as a triumph. He even presented his failure on the deficit (below) as a success, and got away with it because Labour really doesn’t have an alternative plan. The Chancellor did have some genuine boasts: the job-creation miracle continues and corporation tax revenue is up in spite of (or, rather, because of) corporation tax cuts. And he has his very own Mansion Tax! So he reduced his political exposure from the left, his main weakness now is on the fiscal right. And who will attack him from the fiscal right?

Anyway, that’s the politics – the below is the economics.

1. The deficit comes down a tad, but is still way off original plan. And Osborne claims there’ll be surplus in 2018-19.

2. Osborne’s debt mountain. Britain’s debt pile will have grown by more than half a trillion pounds over this Parliament, and the OBR now forecasts that it will peak at £1,638bn in 2018. That will mean the government owes almost £25,000 for every person in the country.

Screen Shot 2014-12-04 at 09.52.44

3. Growth high now, but lower later. GDP growth is a strong 3pc this year, but is downgraded after the election.

4. The unbelievable cuts to come. George Osborne claims there’ll be a surplus by the end of the next parliament, and challenges Labour to match this claim. To build up his surplus, he’d have to cut the state spending/GDP ratio to the lowest level in 80 years. Radical, yes. But credible? I suspect that no matter who wins the election, we will not see cuts anything like those outlined in the below graph. Even the OBR points out that you’d need another £15 billion of cuts in that pre-election year, with no indication where the cash would come from. But importantly, look at the red line, the tax revenue – it’s going nowhere.

5. Pain delayed. And delayed. And delayed. Look at the percentage of the heavy lifting which Osborne said would be done after the election. When he started (top left) he’d do almost all of it in this parliament. The spirit was willing, but the flesh weak – now most of is to be done after the election. What a legacy.

Screen Shot 2014-12-03 at 17.26.01
6. The  job-creation miracle continues: Osborne’s income tax cuts have helped record numbers into work. Far more than even the Treasury predicted in its last Budget

7. But employment is high because wages are low. And will only creep back to recovery in 2020. You have to go back to the 1870s to find a time when wages took so long to recover.

8. Working 9 to 5. The Chancellor said that 85 per cent of jobs being created are full-time – and as you can see below, the government has something boast about here; there are 1.4 million more full-time workers now than there were when the coalition came to power. Osborne also said that people employed full-time have seen their earnings grow by more than 4 per cent over the last year. He forgot to add that it’s only those who are employees, not the self-employed, who have seen this growth – and self-employed full-time workers make up a fifth of the jobs growth under this government. Have they had a pay rise?

Screen Shot 2014-12-03 at 19.46.45

9. The public sector bloodbath. George Osborne will have slashed more 1.5 million public sector jobs by the time his economic plan is finished, the OBR forecasts. The Chancellor has already cut 500,000 so that means there are more than a million job losses to come. The deficit’s stubborn refusal to go down means that Osborne has to hack away at the public workforce in order to balance the books.

10. Stamp duty reform – a.k.a. a new Mansion Tax  The new regime will cut stamp duty for the 95pc of buyers whose homes cost under £925,000. But look at the right hand side of the graph and you’ll see George Osborne’s own Mansion Tax.

Screen Shot 2014-12-03 at 14.28.4911. Black gold shortage North Sea oil revenue (the red line, below) is down 75pc over five years and is set to sink lower still thanks to oil forecasts now almost $20 a barrel lower. Scotland had a lucky escape with its “no” vote. These figure would terrify an independent state.

Screen Shot 2014-12-03 at 13.40.45

12. Still the slowest recovery in history when you factor in the downgrade in later growth in later years. As the OBR says, the pain will now last ten years – and we’re not even halfway through.

Screen Shot 2014-12-03 at 18.17.48


Show comments
  • Conway

    More jobs, but a significant proportion is taken by immigrants, many of whom send their money home, thus taking it out of the UK economy. Wages are low because there are plenty of immigrants to do the job on the cheap and people haven’t had a pay rise. The OBR admits that wages tend to be more tax rich if they are taken home by a smaller number of higher paid workers, than if they are earned by a larger number of lower paid workers. What we’ve got is a low wage economy thanks to an abundant supply of cheap labour willing to work for less. Take home pay is stagnating so the Exchequer is getting less in taxes.

  • grutchyngfysch

    So basically, for the last five years, we have had Gordon Brown’s economic policy -increased spending to meet Labour forecasts, increased borrowing to exceed them – we’ve even had a pre-election binge that we know we can’t afford!

    The decimation of the Armed Forces has continued at pace, with no indication of an abatement in the willingness to use them; we’ve opted back into the EU Arrest Warrant; we’ve completely failed to keep immigration under control despite “iron promises”; there is no meaningful progress on changing the culture of state-sanctioned dependency; aggressive social progressivism rages on; and the flagship education policy, which is so often clung to as a raft by the few remaining Conservative party voters, is lifted straight from New Labour with the same hostility to Grammar Schools.

    Vote Tory, get Labour.

  • BenM_Kent

    Look at that final graph, number 12.
    The recovery from the floor of the recession (just after year 1) followed much the same pattern as other recessions until round about the 30 month mark where it peters out to become the longest recovery in history.
    The reason for that: George Osborne and the Tories. A crap chancellor, a dire Political Party, an horrendous rightwing philosophy.

    • the viceroy’s gin

      …they followed Darling’s budget, lad. It’s LibLabCon policy, to the bone.

  • ManOfKent

    And the Tories think this is going to drive them to victory in 2015? Dear oh dear oh dear.

    The thing is its not rocket science for people to work out that if we shed the Prime Ministers obsessions with the insanely profligate EU, the largesse of his International Aid and Climate Change policies and stopped his foreign adventures (Libya, Syria, Iraq, Ukraine etc), conquering the deficit would be so much easier.

    Its not rocket science either to work out that with those obsessions and the ring fencing of the NHS and Schools that critical areas like Policing, Immigration, Defence and Criminal Justice are going to be slashed not just to the bone but to the marrow. Cameron’s obsessions will result in the government playing fast and loose with the security of the British people and the wrecking of much of the public services and that is something we need to ensure never happens!

    One thing is for sure I do not want to live in David Cameron’s vision of the UK!

  • A World of Paine

    Pushing the old ‘jobs miracle’ line again I see.

    Jobs mirage more like.

    Immigrants under Cameron – 2.2 million and counting
    New Jobs under Cameron – 1.6 million

    Oh dear, another whopper from Dave. Pull the other one Dave, it’s got bells on.

    • Disgruntled Knome

      Wellllll, technically, more go home than stay.

      Going back a few years a company I worked for (and left because their attention to safety was horrific) had employed lots and lots of polish, thing is chatting to the 2 (yes 2 in a company that did have nearer 50) was that they got better pay back in Poland.

      Dont go blaming these people, you have to understand that the real problem is that there are no jobs, lots of entry jobs are now automated, lots are poorly paid, and a low wage economy in a consumerism society can only collapse.

      And that,,,, is the major problem, concentration of wealth, nothing can survive.

  • beenzrgud

    All the lefties will be out this morning shouting about the cuts. I suppose it makes a change from shouting about the deficit, and how it would have been so much better under Labour, ha ha. These are the same numpties who won’t even consider a referendum on the EU, that behemoth that is guaranteed to screw your economy. Sounds like a load of Balls to me !!

  • The BBC Sucks BBCs

    Wages for the bottom 3rd of workers will never rise while there’s an almost limitless supply of cheap EU migrant labour available to replace them.

    • the viceroy’s gin

      Yes, and the Camerloons are celebrating that those low skilled immigrants are the basis of the “jobs miracle” or whatever it is Crosby is spinning now.

  • The BBC Sucks BBCs

    Jobs miracle? What rubbish, it’s mainly minimum wage jobs on zero hour contracts & folks are being forced ofs JSA onto tax credits by the jobcentre staff handing out sanctions like water. People are deciding they’d rather be £20 worse off a week than have to attend the jobcentre everyday to apply for loads of jobs however unsuitable or face a sanction.

    • EricHobsbawmtwit

      Oh no! Are people being forced off JSA? How terrible!

      • The BBC Sucks BBCs

        It is if they’ve got no other sauce of income, the harshness of the benefit reforms are causing many deaths, be all means in UC was in place then force people into jobs, but many jobs leave people worse off than benefits & if they refuse then their sanctioned, often leading to homelessness.

        • Disgruntled Knome

          1 million such people over Christmas last I saw, some 80,000 of them with some form of disability. But I am sure those disabled people deserved it *tries to hide sarcasm*

    • balance_and_reason

      There are consequences to 12 years of Labour misrule…just be thankful that it hasn’t been worse.

      • Disgruntled Knome

        This all started in the 80’s. That led to everything being focused on the Banks and PFI’s, and it was the Banks who are solely blameable for all the problems today.

        One insolvency and real estate crisis led to another led to another led to the Banking Crisis led to companies being liquidated without cause led to government bailouts and the joke we have now that some how the general public have to pay for all their recklessness.

        Labour are in part to blame for it all, they continued and even had Thatcher and previous cabinet members in as consultants to eventually lead to this.

        And now, the Conservatives have exacerbated problems with a massive tonne of propaganda blaming the poor, or as you have, blame Labour (again, it started in the 80’s with, would you believe the Conservatives).

        The economic model has failed spectacularly, and thanks to endless propaganda people are stupidly forgetting who are really to blame.

    • Lady Magdalene

      Well getting out and about will at least increase their exercise levels.

      • The BBC Sucks BBCs

        Staying indoors they could study.

        • Conway

          I admire your optimism!

    • HJ777

      The idea that the increase has mainly been in those employed on zero hours contracts is mistaken.

      In fact, the number on zero hours contracts has only grown modestly – and isn’t so much higher than it was under the ‘boom’ Labour years. The growth in self-employment has been much more significant.

      • The BBC Sucks BBCs

        Self employment? It’s just people claiming tax credits rather than JSA because they don’t want to go to the jobcentre everyday & get sanctioned.

        • HJ777

          I am one of those people who went self-employed. I do not claim, nor would I qualify for, tax credits.

          It is true that self-employed people generally earn less than employed people (I earn less than I did when employed). However, employed people often have higher costs to be paid out of already-taxed income (such as travel-to-work costs) so, in reality the difference is often rather less than the raw figures indicate.

  • Terence Hale

    Hi,
    “George Osborne’s Autumn Statement”. A “Indiz” statement based on Jack and Jill went up the hill and Jill came down with half a crown and it wasn’t for fetching water. Too technical based on unforeseeable events.

  • The Masked Marvel

    In other words, it’s only a matter of time before the public no longer trust the Tories more than Labour on the economy.

    • Conway

      I think that is already happening.

  • justejudexultionis

    ‘The job-creation miracle continues’ —

    You mean the one in which people miraculously accept Third World pay levels, forty per cent pay cuts and the erosion of their human rights and personal dignity through zero-hour contracts? Way to go Osborne, you sure know how to spin an economic shitstorm…

    • UnionJihack

      Harsh words which will resonate in some sections of society. I have a particular issue with the data presented in graph format, the sudden reclassification of public sector jobs in colleges et al as now private sector is surely not linear as implied in section 8 of this article but ought to look like the graph in 9.

      • the viceroy’s gin

        …and what about your Rotherham buddies’ jobs, lad? How are they classified?

        • telemachus

          You only have one post VG
          I urge you to drive to Rotherham via the Wickersley entry
          *

          “DRIVE or walk through the centre of Wickersley today and you’ll find a vibrant, thriving community which has blossomed in recent years. The main shopping centre is now home to chic fashion boutiques, gift shops, homeware and interiors specialists, restaurants/coffee shops and much more.
          It’s a great place to spend a day, wandering the shops, taking in the sights and sounds and enjoying lunch or just a coffee. One of the latest features of Wickersley is The Courtyard, a small selection of shops and a restaurant which is sure to be popular for sitting out on a warm day or meeting up with friends. Alongside the chic boutiques, however, are the more traditional shops and stores which supply a host of everyday essentials to the people who live in this area. In the evening you’ll find a range of great restaurants bringing life to the area after dark, as well as providing a choice of great food and places to go with friends. As one of the largest villages in Rotherham, Wickersley also has much to recommend it to families looking to find a property and settle in this popular area. With good schools serving the village and a large number of families in the area, Wickersley is a thriving centre to the east of Rotherham and close to the motorway links of the M1, M18 and A1.

          • the viceroy’s gin

            I urge you to keep off my posts, troll.

            And did you seriously think anybody was going to read your blather?

    • Disgruntled Knome

      Yeah,, this “massive rise” in full time employment lines up pretty damn well with the massive surge in self employment. Which is people trying to avoid being landed in penury by Iain Duncan Smith.

      But, lets take a look at the tax receipts, its certainly a negative! Now some one with a half decent conclusion would summarise that people not earning enough to qualify to pay would constitute they are not exactly working full time.

      Avoiding the tax dodging high earners entirely for the moment to keep on track, lets look at another problem being Iain Duncan Smiths “workfare”.

      People on workfare ARE COUNTED AS EMPLOYED!!!

      They admitted so 3 damned years ago. Despite the fact workfare is a posh name for a private company doing the job centres job and getting massive pay outs while the person is still only getting JSA.

      Add into that them working, for a company, for JSA at 30 hours a week, it not only denies a person a proper wage, it denies the economy a paid job and the taxation that comes with it. Its a loose loose scenario.

      So yeah, like others, I call bull on the figures hailing them as a success.

      A well constructed lie more like.

  • telemachus

    Lower wages until 2020
    This is why Joe Public does not feel good about the recovery
    They see aristocratic George Osborne and wonder just what he has to say to them
    The same folk see the Tories breaking their promises on immigration and despair

    • tjamesjones

      and then they turn to emily thornberry

      • telemachus

        Thornberry who drew attention to a key fact of urban English political sentiment
        A sentiment that sadly Ukip seek to exploit

        • tjamesjones

          i don’t know what this means – she was mocking the sad sacks she needs to vote for her.

        • sfin

          Quit while you’re ahead.

          Your first post was a good one – coincidentally, UKIP are saying the same thing.

    • balance_and_reason

      Joe public better remember that actions have consequences…lets hope that his memory is intact…finger in plug…electric shock…..finger in plug …electric shock….finger in plug….electric shock….
      what d’ya reckon…Labour 2015…surely the people can’t be that thick.

    • PLJ

      Thats if you believe the CPI adjustments should used rather than RPI deflators. With housing costs included in the RPI real wages will barely recover at all by 2020.

  • Magnolia

    Tax and spend doesn’t mend.
    I thought the statement would have looked just fine in Harold Wilson’s government.
    The 40p tax band to increase, when the same Chancellor just put it down a few years ago, up to 50K by 2020 when it will be worth in real terms say, much the same as it is today.
    It’s a pity because with just a little belief in conservative ideas we might not have been starting from here.
    So much tinkering and minor adjustment, some of which will be very welcome, but no axe taken to cut spending.
    I wonder how it will all end?
    Mr Balls performed quite well, the government looked a bit worried.
    I felt sorry for the front bench women who had to sit squashed up with flesh pressing in on them from all sides. Not enough body space. Best to get rid of at least some of them because they seem pretty useless.

    • McRobbie

      Unfortunately this lack of determination is what you get in a coalition.

      • southerner

        Don’t make excuses for Gideon’s many failures.

  • dalai guevara

    One comment re: your point 5

    … who once coined the term of ‘a lost decade’? It appears we are now certain to have progressed to a stage in which ‘a lost generation’ would sound more appropriate.

    • the viceroy’s gin

      …especially in Rotherham, where your buddies are having their way with the younger generation, eh lad?

  • telemachus

    Dismal
    It is coming to an end
    Soon Ed Balls will be at the helm

    • tjamesjones

      at which point au revior!

      • telemachus

        At which point those struggling with our cost of living crisis will rejoice

        • McRobbie

          Balls will be some magician if he is to find money after his previous gang spent it all when in control of our purses ……”there’s no money left” remember. Balls is no magician, but a con man certainly.

          • telemachus

            He is fair

        • tjamesjones

          because it’s good to lose taxpayers?

        • The Masked Marvel

          You spelled “be worse off than ever” wrong.

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