Frances O’Grady accuses government of using austerity as an excuse to implement policies that no-one has voted for

Tim Lezard

Frances-O'Grady_smaller_webTUC general secretary Frances O’Grady has accused the government of using austerity as an excuse to implement policies that no-one has voted for.

Speaking yesterday at the CWU annual conference in Bournemouth she said that despite recent International Monetary Fund (IMF) criticism of the government’s austerity economics, the Chancellor is showing no sign of changing course.

She said: “Spending cuts, unemployment and austerity look more and more like hard right politics, rather than necessary economics.

“Even the IMF now says that the UK should ease up. This comes after IMF research showing that spending cuts make deficits worse when an economy is depressed. They may reduce spending, but if they suck the life out of an economy then the tax take falls even more.

“Remember – this government originally said they would have reduced borrowing to £37 billion a year by 2014. Now they say it will be more than £100 billion.

“And in another blow to the Chancellor, we now find that he has based his economic strategy on a dodgy spreadsheet. He has been fond of quoting an economic paper saying that when debt goes over 90 per cent it stops growth.

“That meant we could not do what every sensible economists since Keynes has said – that when an economy needs a kick-start it is right to borrow to invest in recovery. But now we find that 90% figure comes from a spreadsheet full of errors. There is no such limit.

“Of course big national debts are a problem. It is right to want to reduce the deficit. It has always been the case that this government was trying to move too quickly.

“We didn’t pay back the cost of fighting the Second World War until this century. Now of course the 2008 crash was not a world war, but it did huge damage to our economy. A bubble built up over many years. When it burst, it hit the global economy to its foundations. We came close to economic cataclysm.

“Expecting to put that right in just a few years was always mistaken. But now we know that the tools chosen are making the problem more severe. It is certainly hurting, but it sure ain’t working. So why does the Chancellor persist?

“Perhaps it is simply because he doesn’t want to admit a mistake. But it goes deeper than that. For this is not economics, but politics. The economic crash is being used as an excuse to implement policies that voters have rejected every time they have been given a proper choice.

“The objective is a small state in a nastier society. Spend less, make ordinary people pay more VAT and bank the savings with tax cuts for big businesses and the few at the top.

“It’s all of a piece with other policies. Destroy the fundamental principles of the NHS through fragmentation, privatisation and cuts.

“Slash away at support for some of the most vulnerable in society, rather than create the jobs that will get the unemployed back to work.

“Put workers under pressure to sell off basic employment rights as a price for taking a job. Attack community facilities such as local post-offices and privatise the Royal Mail.

“No-one can pretend that dealing with such a big crash would ever be easy or pain free. But what should have happened is a recognition that the years of privatisation, deregulation and letting the market rip had failed.

“We should be building a new economy that can provide the jobs, security and living standards that can give us a decent future.

“Instead we are simply getting an increased dose of the policies that caused the damage in the first place. That is why we must change course – and change course fast.”


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Tim Lezard

Campaigning journalist, editor of @Union_NewsUK, NUJ exec member; lover of cricket, football, cycling, theatre and dodgy punk bands

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