John McDonnell

Seize the moment!

John McDonnell
Seize the moment!

FOR SEVEN YEARS TORY CHANCELLORS, Philip Hammond and before him George Osborne, have constantly argued that austerity was the only way to rescue the economy after the great economic crash of 2007/8. Central to the doctrine of neo-liberalism that they have consistently advocated was that austerity must be accompanied by tax cuts to the corporations and the rich so that miraculously wealth would somehow trickle down to the rest of society.

As a result our society has experienced seven hard years of austerity. And it has been hard. Here’s a small selection of the hardships the Tories have inflicted on our people.

  • Four million of our children now live in poverty.
  • A record number of 72,000 children have been taken into care - the highest number ever.
  • Over one million food parcels were provided by food banks last year.
  • Homelessness has risen by 50%, while rough sleeping has more than doubled.
  • This government has built fewer homes than any government since the 1920s.
  • One million people no longer receive the care they need.
  • Freedom of Information requests have confirmed that 2,300 people classified as fit for work under the brutal Work Capability Assessments have died before they could start work.
  • Over two million people waited more than four hours to be treated in our accident and emergency units.
  • Our schools are experiencing the first real terms cuts per pupil since the 1990s.
  • Students are now leaving university with debts averaging £55,000.

As for our economic performance, in one week this month three reports were published demonstrating the failure of the Tories’ neo-liberal policies:

  • The OBR (the Office of Budget Responsibility) confirmed that productivity, the vital economic ingredient, has stagnated.
  • The IMF (the International Monetary Fund) downgraded the growth forecast for our economy.
  • The ONS (the Office for National Statistics) reported that we now have a record current account deficit.
  •  While the Tories boast of growth in the number of people at work, we now know that 3 million people are in insecure work and over 800,000 are on zero-hours contracts. Wages are also lower today than they were in 2010. Inflation is outstripping wage increases so that people are faced with a real terms cut in their income.

As soon as I was appointed shadow Chancellor I asserted that austerity was not an economic necessity but was a political choice and would fail to address the underlying problems of our economy.

Osborne, and then his replacement Hammond, denied this was the case. They argued repeatedly that austerity was vital to secure economic recovery. It was the central tenet of their so-called long term economic plan.

Well here’s a strange thing. There are reports that Hammond is so under attack, and with so many calling for him to be sacked, that to save his skin he is preparing a revolutionary budget, rejecting austerity and bringing forward a pale imitation of some of Labour’s manifesto policies. Of course it’s bound to be a stunt, but the very fact that it is even being mooted tells us that the assertion by Hammond and Osborne that austerity was a necessity was, as we have said, a big fat lie all the way along.

To save his job, Hammond is ready to dump austerity and may even hold off a few more tax cuts to the corporations he was planning. The Tories are now proving exactly what we explained - that austerity is a political choice, not an economic necessity.

The tragedy is that so many have suffered so badly as a result of this political opportunism by Hammond and the Tories. The Tories couldn’t resist seeking to use the economic crisis as the excuse to achieve their party’s long held ambition - to demolish what is left of the welfare state introduced by the Attlee Labour government and to redistribute power and wealth from working people to the rich and corporations.

They nearly got away with it - except that people realised what they were up to and 13 million voted against them in the last election. The result of the last election has forced the Tories to junk most of the plans in their manifesto for the next assault on our welfare state and on working people. But never underestimate their determination to finish off our public services, especially the NHS.

That’s why in this coming period we all have a heavy responsibility to build our movement to enable us to defeat the Tories at the next election. The Tories are hoping against hope that the enthusiasm and energy shown by Labour Party members and supporters is just a flash in the pan and will soon dissipate.

That’s not the impression I get when I am touring round the country - far from it. We are growing in strength and determination. Let’s all recognise the opportunity we have - and the responsibility we have to seize it.


Shadow Chancellor, MP for Hayes and Harlington, Chair of the Socialist Campaign Group of Labour MPs and Chair of the Labour Representation Committee. John has been involved in Labour Briefing since the early years.