Osborne's speech: The rundown

We provide the highlights from Conservative chancellor George Osborne speech to the Tory conference today

  • No temporary tax cuts
  • Euro-crises biggest issue
  • Keep low interest rates and get banks lending
  • Employees must work two years before filing for unfair dismissal
  • Investment in science

The Conservative party conference didn’t get off to a great start in Manchester yesterday. The red carpet was replaced with 35,000 protesters at the TUC organised rally. Chancellor George Osborne told demonstrators from inside the conference: “It’s your democratic right to march, but in the end marching is not going to move on this economy.”

What did he say today in his speech? Will it do anything to placate the angry hordes of anti-cut placard wavers today?

Here’s our rundown:

A mixed opening, hope peppered with caution, pragmatism mixed with a dash of optimism with a reference to good old English stoicism to polish it off.

“Today all around our country and indeed all around the world people are anxious,” said the chancellor. “I come to you with words of resolve, determination, confidence and belief. I don’t want anyone to think that the situation is hopeless – let’s not talk ourselves into something worse.

“The British people will overcome this challenge as we have overcome many before. Together we will ride out the storm.”

Osborne moved swiftly on to outline the root of our problems in three neat answers to the question: Who is to blame?

The last government, the banks and our European neighbours.

“Our economic problems were not visited onto this country by some cruel act of god – they were created by the mistakes of human beings,” he said.

Three economic mistakes made:

1 “The last government borrowed too much money all on the promise that boom would never end in bust – a catastrophic mistake.” And he squeezed in the first of many snipes at the shadow chancellor, “economic adviser to Gordon Brown, I’m not sure if I would put that down on my CV if I were Ed Balls.”

2 “Banks ran up debts of their own .The banks and those regulating them believed that the markets would regulate themselves.”

3 “European neighbours plunged head long into the euro without thinking about the consequences. For generations to come people will say thank god Britain didn’t join the Euro.”

The major points of the speech:

The Euro-crisis needs to be resolved. Osborne laid some of the resolution to the UK’s problems outside of his remit, citing the euro crisis as the biggest threat to our economy, the resolution of which would sort a lot of our problems. “The time to resolve the crisis is now, Eurozone leaders have to “get out and fix their roof even though it’s pouring with rain”

The resolution to our own debt crises will not come from more borrowing. “Right now temporary tax cuts and borrowing are two sides of the same coin. I know we are asking a lot of people – don’t think I haven’t thought hard about what more we could do. Borrowing too much is the cause not the solution.”

Low interest rates and getting banks to lend. “We will help the Bank of England keep interest rates at record lows. Nothing would be more crippling than a sharp rate in interest rates. Because banks are damaged they won’t lend at the current low rates therefore the sane plan is to get credit flowing in the economy. We are making sure that the banks are strong enough to do so.” He added that the Treasury is looking at ways to inject money directly into those parts of the economy that need it. It is called: “credit easing.”

The BBC’s Robert Peston explains “credit easing”.

No to bank tax. A bank tax if it drives banks abroad is self-defeating, Osborne warned. “I understand the anger people feel about what happened - but ramping up popularist rhetoric won’t help.” He called for “putting the BoE in charge of monitoring debt, a responsibility that should never have been taken away by Brown”.

Tackling tax evasion. Osborne announces that he will be sending a message to the rich who are not paying their fair share and pledges to be just as tough on tax evasion as benefit fraud. “We will find you and we will find your money, the days of getting away with it are over.”

National research programme. Osborne announced investment in science stating: “We’ve got to get Britain making things again.” He also announced a national research programme to take the discovery of graphene - a high-tech material - “from the British laboratory to the British factory floor”. It was discovered in Manchester and other countries are now showing an interest apparently.

Stopping strikes. In a message to unions unhappy about pension changes, he says to go on strike will “hit growth, cost jobs” and is “totally irresponsible”.

Employment law shake up. Employees will have to work two years before they can make unfair dismissal charges – up from one year previously.

Climate change. Osborne said Britain makes up less than 2% of the world’s carbon emissions while China and the US make up 40%. Carbon emissions will be cut no slower, but also no faster, than other European countries he says - the idea is not to disadvantage business.

Freeze on council tax. Money will be made available to freeze council tax in England - money will also be offered to Scotland and Wales too. News that was well received by the audience.

Coverage here from The Guardian

Reactions from the London business community:

John Walker, national chairman, Federation of Small Businesses, said:

“The Chancellor has announced some welcome measures to help small businesses, including doubling the amount of time a member of staff has before they can take their employer to unfair dismissal tribunal. However, it is difficult to regard the Conservative Party as the party of small businesses only two days after it introduced a raft of new and costly employment regulations which will hinder small firms growth plans and burden them with yet more red tape.

Stephen Robertson, British Retail Consortium director general, said:

“The Council Tax freeze will make a useful contribution to easing the pressure on household budgets, leaving customers’ with more money to spend on the things they need and want.

“But, if the Government really believes in generating growth, it will limit the burden for businesses too. Under the current rules, businesses are likely to be hit be a destructive five per cent increase in business rates next April on top of a similar increase imposed this year.

“These extra costs can only undermine retailers’ ability to invest and create jobs. The Government should abandon the rates-roulette of basing each year’s increase on the previous September’s RPI. We need a system that produces Business Rates changes that are more certain and, above all, more affordable.”



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