George Osborne: Robbing the Next Generation of Investment in Their Futures

  • For all their claims about the last Labour government, the Tories borrowed more in their first five years than Labour borrowed in 13 years.

  • Chuka Umunna MP

George Osborne is never shy in telling us how wonderful he is on Budget Day – no more so than when fishing for votes amongst the 150,000 Tory members who will determine the identity of the next Prime Minister, given the current incumbent has signalled he will go before the 2020 General Election.

At every Budget it is worth revisiting the promises David Cameron and George Osborne, the man he installed in the Treasury and the PM’s preferred successor, made when they came to office.

At the June 2010 Budget, they set a target to eliminate the deficit by 2015/16, which they expected to achieve a year earlier in 2014/15. In the event, the Chancellor failed to meet this goal. The deficit came in at 2.4% in 2014/15 and is forecast to be 1.6% of GDP in 2015/16. It does not move into a surplus until 2017-18, some three years later than promised.

They set another supplementary target: for public sector net debt as a proportion of GDP to be falling by 2015-16. The Chancellor only managed to achieve this by some smoke and mirrors action with the numbers, namely through asset sales to pay down enough of the debt for this target to be met. The disastrous, rushed through sale of Royal Mail illustrated the folly of that approach with the tax payer being short changed to the tune of hundreds of millions of pounds as a result.

And, when Osborne took office we were told the ratio between the country’s debt and its gross domestic product would rise only from 61.9% of GDP in 2010 to 67.4% this year, but debt as a proportion of GDP is forecast to be 82.5% this financial year. This is because the Tories racked up £200 billion more borrowing than planned in their first term due to their policies failing to deliver growth. Never forget: for all their claims about the last Labour government, the Tories borrowed more in their first five years than Labour borrowed in 13 years.

So, Osborne will claim his Chancellorship a success next Wednesday but he has failed to meet the benchmarks against which he said we should judge him when he moved into No 11 Downing.

And which group, above all else, has paid the price for his failure and are now being punished as Osborne seeks to retrieve something in time for the Tory leadership election? Our young people.

When he came to office, the Chancellor halted investment in the Building Schools for the Future programme which sought to ensure young people had the best learning environment possible to equip themselves for the future.

When those students moved on to further education he cancelled their Education Maintenance Allowance, which helped pay for their books and travel to college. Analysis from the House of Commons library shows the government’s failure in last Autumn’s Spending Review to protect funding per student studying in school sixth forms, sixth form colleges and further education colleges, amounts to a cut of 9.4% per student, adding insult to injury.

Then, when those students arrived at university, Osborne trebled their tuition fees, replacing support which was previously there with loans that now saddle our young people with a lorry load of debt before they can even contemplate home ownership (a concept now out of reach for so many). The spending review reinforced this by replacing grants for nurses, midwifery and allied health subjects with student loans, in addition to the previously announced scrapping of higher education maintenance grants.

This assault on the hopes and dreams of our young people continues next month with the exclusion of the under 25s from increases in the national minimum wage due to come into force.

So how does Osborne get away with this at every Budget? At the 2015 election, turnout amongst 18-24 year olds was 43%, and 54% amongst 25-34 year olds. This is in contrast to turnout amongst the over 55s, where turnout was 77% amongst those aged 55-64 and 78% amongst those aged over 65. We all have a big job of work to do, particularly with changes to voter registration, to increase turnout amongst younger voters.

Labour received the support of 43% of those aged 18-24, compared to 27% for the Conservatives. The Conservatives received 47% of votes of those aged over 65, compared to 23% for Labour. Osborne was well aware of the differential turnout and differences in support by generation for the parties in the lead into the 2015 election.

But the Chancellor increasingly will focus on the electorate that will matter to him most over the next couple of years: his party members. Sound data on the average age of a Tory party member is hard to come by but most put it in the late 60s, so the prospects for him delivering much for the next generation in 2016 look more bleak than ever.