The gloves are off thanks to the Chancellor's clear mini-budget. Sadly, it's not a pretty sight for very many people and the North. The Prime Minister's favourite tune that we're all in it together has been replaced by some old ditties - if it ain't hurting, it ain't working and unemployment is a price well worth paying.
Tackling the economic crisis was inevitably painful but this Government is prescribing a kill or cure remedy on a wing and a prayer that it will turn the patient round.
Families will lose £1,000 a year and more than a billion in tax credits whilst the banks are only being asked to divvy up £300 million, despite their historic responsibility for the mess we are in. The top tier of taxpayers is untouched and there was no mention of real action to tackle tax evasion and avoidance.
This means a further 100,000 children living in poverty on top of the 300,000 extra children below the breadline that neutral experts have warned about. The pay of nurses, soldiers and police officers will be frozen at just 1% for a further two years which is way below inflation and is therefore a pay cut.
No wonder that George Osborne was careful to side-step my probing in the Commons about how this would affect so many people we rely on to look after us.
I pointed out that inflation is 5% and that the average nurse has had a two-year pay freeze, faces two years of a 1% pay limit, a 3% theft on her pension and frozen or capped increments.
I asked him to agree that over this Parliament the average nurse's living standards will fall by 10%, and that, if the plans for regional pay go through, people in the regions might be even worse off. His silence said it all.
A further 300,000 public sector jobs will be shed in addition to the planned cut of 400,000 jobs, despite it being well understood that such jobs and contracts stimulate and supply private sector demand and activity. The impact will, as we know, be even harsher in the North East and there is little hope that all these public sector jobs will be replaced by more jobs in private companies, though we ought to keep trying in any case.
It seems to me that once again the Conservatives have abandoned ship in the North East. No wonder the North East Chamber of Commerce is warning that the north-south divide could become so wide that it takes generations to overcome. We are also still reeling from the effects of previous policies that widened the gap.
All this bleak austerity is about not spooking the money markets but it doesn't have to be done this way. One senior Conservative MP said the markets will not go haywire with a modest loosening in borrowing in the short run for the right reason.
One of these right reasons could be a temporary reversal of the VAT increase which could stimulate demand. Yet the Government is stubbornly sticking to its Plan A with pitifully minor modifications such as deferring fuel duty increases and some investment in rail and road, though there will be little or no gain for us in the North East.
All this bleak austerity fuelled further anger by the millions who went on strike yesterday and it is ever more essential that pension changes are negotiated fairly and thoroughly with the trade unions.
At least we all know where we stand. The North has its work cut out in defending itself in these needlessly bleak times.
Newcastle Chronicle and Journal
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