Boris Johnson’s bet may pay off. The former mayor of London led the campaign for Britain to exit the European Union and is now the favorite to replace David Cameron as prime minister.
But he’s no shoo-in for the position. Around half the parliamentary party supported Cameron and his bid for Britain to remain in the EU. They may not be ready to forgive Johnson for so passionately making the opposite case and there are doubts about just much he really wanted Britain to leave.
This is the same man who once said, “I am the only British politician who will admit to being pro-immigration.” The same man who once supported Turkish membership of the EU. The man who can always be counted on to argue for lower taxes, fewer regulations and less welfare. Those are not exactly the priorities of the traditionalist right wing he chose to affiliate himself with.
Johnson was something of a libertarian before he pretended to be a reactionary. The reactionary wing of the Conservative Party may remember. Especially now that the one thing that always trumped everything else to their minds — Europe — is no longer going to be an issue.
Britain’s chancellor, George Osborne, kept his budget firmly in the center of British politics on Wednesday when he unveiled a combination of tax and spending policies that should satisfy either side.
To the delight of his Conservative backers, Osborne announced a fall in capital gains tax — which he raised in his very first austerity budget — from 28 to 20 percent and a reduction in corporate tax from 20 to 17 percent by 2020.
“Britain is blazing a trail,” he said. “Let the rest of the world catch up.”
Smalltime entrepreneurs will also benefit from a tax break worth up to £2,000 per year for income from goods sold on eBay and rooms rented out via Airbnb.
Britain’s George Osborne backed away from a controversial plan to cut tax credits on Wednesday when he unveiled the first purely Conservative Party budget in twenty years.
The House of Lords last month voted down his proposal to cut tax credits, which would have saved the government some £4 billion in annual spending but also left low-income families up to £1,000 per year worse off.
British prime minister David Cameron’s surprise victory in May’s general election has made it more likely that his like-minded chancellor and deputy, George Osborne, will succeed him as Conservative Party leader before the next election, due in 2020.
George Osborne on Sunday rejected the possibility of shifting Britain’s ruling Conservative Party to the right if Labour elects the far-left Jeremy Corbyn as its leader this weekend, saying it needs to occupy the center ground Labour has abandoned.
In an interview with the BBC’s Andrew Marr, Osborne, who is seen as a likely successor to Prime Minister David Cameron, argued that the Conservatives have a “big responsibility to represent the working people of Britain on the center ground of British politics and to offer support and a home for people who don’t want a Labour Party that is far off to the left.”
He denied that the fiscal consolidation effort over which he has presided as chancellor most hurt the poor who might otherwise vote Labour. “The people who suffer most when the economy fails are the poorest,” he said.
Like Cameron, Osborne may be more liberal than conservative and is the face of the “modernization” project that moderated the Tories’ image and rhetoric and helped them win their first parliamentary majority in twenty years in May’s general election.
Britain’s George Osborne surprised opposition parties on Wednesday by announcing a “living wage,” borrowing a left-wing policy proposal to offset deeper welfare cuts and tax measures that benefit middle incomes and corporations in what was the ruling Conservative Party’s first budget since it won reelection in May.
Unbound from his Liberal Democrat coalition partners, the chancellor announced plenty of policies to satisfy Conservatives: a commitment to meet NATO’s 2 percent defense spending target, a raise in the inheritance tax threshold for married couples from £650,000 to £1 million, an increase in the threshold at which the 40 percent income tax rate kicks in — which is expected to take 130,000 earners out of that tax band — and a reduction in corporate tax from 20 to 18 percent.
As expected, he also announced further austerity for those on welfare. Working-age benefits — with the exception of disability benefits and maternity pay — will be frozen for four years while Britons under the age of 21 will no longer qualify for housing benefits. Osborne said the welfare cuts would add up to £35 billion in savings by the end of this parliament.
With two months to go before a general election, Britain’s coalition government announced plans on Wednesday to further ease its austerity program and use the proceeds of a £900 million bank levy to finance tax relief for low-income earners.
Chancellor of the Exchequer George Osborne told Parliament in London he was able to end the squeeze on public spending a year earlier as the United Kingdom has emerged as one of the fastest-growing economies in the developed world under a coalition government of Conservatives and Liberal Democrats.
Under his latest spending plan, the deficit — which the Conservatives claim to have cut in half since they took over from Labour in 2010 — would fall to 4 percent this fiscal year. By 2018-2019, the budget would post a surplus for the first time.
Osborne insisted there would be “no giveaways” and proposed to use the savings generated by low interest rates and inflation to pay down the national debt.
But he also announced a rise in the personal tax-free allowance to £11,000 next year as well as an increase in the threshold above which Britons pay the highest rate of income tax.
Prime Minister David Cameron said last year he would raise the income tax threshold to £12,500 if he is reelected in May.
The 40 percent income tax currently kicks in at £31,900. Cameron said he would raise that to £50,000.
The measures will benefit both low and middle incomes and make it harder for Labour to claim Osborne’s Conservatives are the “party of the rich.”
Earlier, the chancellor unveiled housing tax reforms. Unlike Labour, which would tax expensive homes every year regardless of their owners’ incomes, the government wants to tax homes when they are sold. For sales under £250,000, the rate would be 2 percent or less. For homes valued at £1.5 million or more, the rate would be 12 percent.
Labour leader Ed Miliband nevertheless charged that the “gap between the chancellor’s rhetoric and the reality of people’s lives” had never been greater, adding that it was “extraordinary” the government would not invest more in the National Health Service.
A fairer criticism of Osborne’s budget policy has come from his Liberal Democrat coalition partners.
Nick Clegg, the deputy prime minister, said last year the Conservatives were “kidding themselves” and the British voters “if they are claiming that it is possible to balance the books, deliver unfunded tax cuts, shrink the state and support public services in the way that everybody wants.”
Beyond freezing working-age benefits, the Conservatives have not made clear where they would cut to wipe out the deficit by 2019.
With the National Health Service exempt from cuts, it is especially difficult to see how other departments, such as defense, education and police, would not be seriously affected.
Mr Osborne could have increased the science budget by 15 percent. The chancellor likes to sport a hard hat on construction sites but has spurned infrastructure investment in favor of repayment of low-cost public debt.
The newspaper did praise other “sensible” policy shifts, including the further devolution of powers to North England and the government’s fiscal support for North Sea oil producers. On top of a corporate tax cut from 30 to 20 percent, Osborne announced a reduction in the supplementary charge levied on oil producers to help the industry cope with falling petroleum prices.
The Guardian, a left-wing newspaper, was less impressed, pointing out that Osborne had missed his earlier deficit and debt targets — which The Guardian and Labour Party it supports criticized as unrealistic in the first place — and was putting “expediency above principle” with gimmicks designed to win votes in May.
The Telegraph‘s Dan Hodges agreed Wednesday’s was an “ultra-political budget from an ultra-political chancellor” but did not share The Guardian‘s optimism that Labour still had a fighting chance. The absence of game-changing giveaways, he argued, showed the Conservative Party was confident the election is theirs to lose.
David Cameron and George Osborne never viewed this budget as a game changer but as a game closer. It is the budget they penciled in five years ago, to underpin the election campaign they penciled in five years ago to deliver the election victory they penciled in five years ago.
British prime minister David Cameron’s two likeliest successors as Conservative leader represent rival wings of his party. Home Secretary Theresa May is favored by rightwingers while Chancellor of the Exchequer George Osborne is associated with the more liberal, modernizing movement in the Conservative Party that Cameron himself spearheaded.
How well Conservatives do in next year’s election could determine which of them wins a future leadership contest.
The Observer‘s Anne McElvoy argued on Sunday that one of May’s main advantages is her classlessness — “at a time when the posh boy atmosphere has not helped some reputations” in the British ruling party.
A product of mixed private and state schooling with a technocratic background as a consultant, she has done the slog of heading a local government education committee in south London on her way to political glory. The contrast with the gilded sorts who floated into plum seats through connections and a stint in the Conservative Research Department is self-evident.
She also appeals to more reactionary members “who feel that the trend toward younger party leaders has landed them with a ruling class too close to metropolitan elites and not close enough to the hearts of minds of Conservatives tempted by UKIP.”
However, her attempts to outflank Nigel Farage’s nationalist party with a hardline immigration policy — that includes clamping down on how long foreign graduates can stay in the United Kingdom — rubs more liberally inclined Conservatives the wrong way.
George Osborne is far more of a classic economic liberal, “trying to work out a future for Britain in an era of advancing globalization” rather than building a “fortress Britain,” as McElvoy puts it.
“You would not catch George defining success by how many talented people he kept out,” she cites one of his supporters saying.
The opposition Labour Party may like to depict Osborne as a ruthless budget cutter but the chancellor is actually far from rigid. He delayed his deficit targets when revenues were lower than expected, supported a minimum wage increase and wants to cut taxes even when the budget is still in the red.
May has said little about economic and fiscal policy but her instincts would probably be less conciliatory.
The outcome of next year’s general election could help determine whether May or Osborne emerges as the more credible Conservative Party leader.
If Cameron is defeated, his entire modernization project will likely be considered a failure and Osborne could go down with it.
But if Cameron wins reelection and also delivers a “yes” vote for continued British membership of the European Union in a referendum, “those closely associated with him will have the wind in their sails and have vindicated the modernizers’ cause,” according to McElvoy. May would then look more like a throwback.