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The leading economic think-tank, the Institute for Fiscal Studies, has delivered its verdict on Wednesday’s Budget and cast doubt on whether it will turn out to be the trump card the Tories have been hoping for.
IFS director Paul Johnson, the country’s most authoritative expert on taxation and spending, says the poor have lost most from the coalition’s benefit changes of the past five years. He calls on Chancellor George Osborne to specify how he plans to cut welfare spending by £12bn.
He also casts doubt on Osborne’s claims that people are better-off than they were in 2010. Osborne, he says, was relying on a forecast of what would happen by the end of 2015 – but it hasn’t happened yet. “There is no actual increase in the data we have so far.”
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And in contrast to the triumphalist tone of Osborne’s Budget speech, Johnson said the pick-up in living standards was the slowest in modern history. It was no cause for celebration.
The significance of the IFS verdict is that it resonates with doubts expressed by the pollster peer Lord Ashcroft in a pre-Budget review of polling on voters’ attitudes.
The former Tory party treasurer has conducted more than 100 national and constituency polls. On the key question of living standards he finds that “fewer than one-in-five say they are already feeling the benefits of an economic recovery” while two-fifths believe they will eventually benefit but haven’t done so yet.
Worryingly for Osborne and Tories, another “stubborn” two-in-five say they are not feeling any benefits from an improved economy and they don’t expect to. “A majority of both Labour and Ukip voters say they expect any recovery to pass them by,” says Ashcroft.
For all the virtuosity of Osborne’s Budget performance, he presumably left these voters cold.
Not everyone is down on the Chancellor, however: the bookmakers William Hill are reporting that 90 per cent of the election bets taken during and since Wednesday’s Budget speech were for the Tories to be the largest party and to form the next government.
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