When George Osborne stands up to deliver his Autumn Statement today, he does so against a backdrop of his highest economic competence ratings for two and a half years.
The last time the Chancellor was this trusted to see the country through the present economic situation, Westminster was a rather different place.
In June 2011, the Tories were snapping at Labour’s heels and occasionally ahead on voting intention. The structural deficit, we were promised, would be eliminated by the end of the Parliament and the Conservatives would reap the electoral rewards from the economic recovery projected to come alongside this.
But then came the Autumn Statement of 2011 and the omnishambolic 2012 Budget, austerity and cuts were extended to 2017, and the election message changed from “We’ve fixed their mess”, to “Let us finish what we’ve started”.
Today, Labour’s lead in the polls has been uninterrupted for nearly two years and Ed Miliband has set the agenda with his energy price freeze pledge. But the impression that economic growth is actually returning has helped the Chancellor regain his credibility. Mr Osborne is trusted by 28% of the public to see the country through its current economic situation, leading Ed Miliband by 3 percentage points and Ed Balls by 10. Nevertheless, the Chancellor needs to use this recently acquired capital to shift a number of prevailing attitudes in his speech today if his economic success is to translate into voter popularity.
First, he will need to set out exactly what the Government’s plans are to fight rising fuel bills. A hashed-up set of briefings in recent weeks containing a plethora of different policies has confused the public, with just 30% saying they understand what the Government plans to do on the issue. Forty-four percent say they do not understand the plans and 26% say they do not know whether they know or not! The Chancellor must make sure his statement is crystal-clear to ease confusion and set the record straight.
However, such is the distrust among the public of energy companies (a recent ComRes poll for ITV News shows them more unpopular than banks), that many people do not believe any “soft” approach on the sector will benefit them personally. In fact, a majority (51%) believe that even if the Government cuts taxes on energy, companies will not pass the savings onto consumers and bills will therefore not get cheaper. The suspicion is that the companies know people are willing to pay higher prices and will therefore pocket the difference after the levies are removed. Mr Osborne’s faith in the market will no doubt lead him to conclude that this will not happen, but the British public will believe it when they see it.
What is to be done on infrastructure is also important. In PR terms, this was covered by yesterday’s separate Infrastructure Spending Review - although as this is the fourth such announcement of the Parliament, it remains to be seen whether voters will believe what was promised.
While HS2 has dominated transport news, ComRes data for BBC Radio 5 Live shows the area the public think most need of improvement is the roads. Yet any mention of roads was widely missing from yesterday’s announcements, interviews and briefings. The same poll also shows 52% opposing HS2, suggesting there may be a political dividend for the first party to declare outright opposition to it. Both advocates and opponents of the project will be watching closely for any signs that the Chancellor may be about to blink on HS2, or whether it’s full steam ahead.
Money in the pocket
But for all the focus on the trains, tracks and trucks of large-scale projects, it will be attention paid to the Pound in people’s pockets that will be of most consequence. The Chancellor knows he needs to convince the public that confidence in the economy will translate into tangible improvements in living standards, at a time of continuing real wage deflation.
Despite the public being evenly split about whether the UK economy is getting better or worse (34% in each case), fewer than half as many (15%) say their personal financial situation has got better. Even those in work are twice as likely to say their job security has got worse over than past three months (31%) than say it has got better (16%).
This has led to a situation where the Government is thought to understand the concerns of big business and people on high incomes, but not small businesses or people on low or medium incomes.
Base: All GB adults (n=2,012)
The balancing act that the Chancellor finds himself in is having to show that not only can he drive the economy forward on the road to growth, but also to explain how he won’t leave any of the passengers behind.
Economic recovery presents an additional danger for the Conservatives come 2015. Ironically perhaps, the better the economy gets, the less important it becomes relative to other electoral issues like the NHS and education – which play more to Labour’s strengths. So Mr Osborne needs not only to ensure continued recovery – and make people feel they are better off – but he also needs to persuade voters that economic recovery would seriously be jeopardised by a change of Government.
For the time being then, while the Chancellor enjoys a healthy poll lead over Ed Balls, the gap between the Chancellor and the Leader of the Opposition is too narrow for him to be comfortable.
Methodology: ComRes interviewed 2,012 British adults online between 29th November and 1st December 2013. Data were weighted to be demographically representative of all GB adults aged 18+. ComRes is a member of the British Polling Council and abides by its rules.
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