Osborne Grabs For The Centre

As George Osborne delivered his first Party Conference speech as the Chancellor of the Exchequer for a majority Conservative government, he didn’t just reinforce the Conservative strategy to occupy the centre of British politics, he used a megaphone.

In marked contrast to the speech by Labour’s new Shadow Chancellor, John McDonnell, last week, the speech was directed over the heads of the audience in the hall to the electorate and to the media.  At the same time, again in contrast to the speech of Labour’s new Leader, Jeremy Corbyn, he sought to bind the Party faithful to the particular brand of Conservatism he and David Cameron have set out, rather than bind himself to them.

All the policy announcements and signals were in line with what one has come to expect from George Osborne. Amongst them was there was confirmation of the pre-briefed setting up of the National Infrastructure Commission, headed by Lord Adonis (who resigned the Labour whip to become a cross bencher in order to take up the role).

The big surprise was the announcement on the devolution of the uniform business rate to individual councils.  As many have already pointed, this was the latest example of Mr Osborne stealing Labour clothes.  It is more than that though: it is immensely politically astute. It does indeed give councils control of spending of the revenue raised, but crucially it gives them power to vary, cut or reduce rates.  Councils who choose to reduce rates to encourage or support business will have to deal with the consequent reduction in the tax take and what that might mean for council spending.

It is also hugely important in areas where there are potential infrastructure development projects – such as airports – which will then be subject to business rates.  It is much harder to oppose such projects if local councils and local people will be the direct beneficiaries of the increased revenue raised.   The path is being cleared.

The details will be set out in the Autumn Statement/Spending Review in November.  Meanwhile, George Osborne has set out a clear statement of where he might take the Party as well as the country.

Michelle DiLeo, Head of Public Affairs