Economic growth is half what was predicted and is the slowest quarterly growth for two years.
According to the Office for National Statistics the economy grew by 0.3% in the first quarter the year.
Compared with 0.6% in the last three months of 2014 and 0.7% three months earlier the figures are disappointing and are a serious setback to the Conservative claims that they’ve turned around the economy.
Even the Chancellor, George Osborne had to admit, “we have reached a critical moment. Today is a reminder that you can’t take the recovery for granted.”
Quick to point out that all is not well with the economy Labour’s Ed Balls said: “While the Tories have spent months patting themselves on the back these figures show they have not fixed the economy for working families.”
It certainly helps Labour with only nine days to go before the general election, that these figures show that all is not as rosy as the Tories would like the voters to believe.
Despite the huge boost from lower oil prices to consumer spending and the transport sector, the economy would seemingly be heading back into recession.
As this almanac mentioned last week much of the boom of last year was based on artificial increase in house prices based on cash thrown at the help to buy scheme.
Now that the property market has cooled so has the economy.
Today’s news sees another wheel come off the Conservative election strategy.
They first targeted Miliband as weak but he defied their portrait of him. And it was Cameron that was seen as chicken in not debating with Miliband.
Bad economic news
Now another wheel comes off with the bad economic news.
In opinion polls the Tories have always led on economic competence. It hasn’t given them the traction they hoped it would. But they thought that it might swing undecided voters at the last minute. Well, today’s news has undermined that strategy.
Apart from a budget deficit of 5% of national income the UK has a balance of payments deficit of 5.5% of national income. Top that up with much lower productivity than other competitive countries and you have an economy that’s in a mess.
Some economists have described the UK economy as “a ticking time bomb waiting to explode after the election.”
For people to believe in economic competence they have to feel it in their pockets. Not many voters do. Today’s news on the growth just adds to their disbelief in what Cameron and Osborne are telling them.
If the polls are to believed the SNP will sweep the board in Scotland.
The Conservatives throughout the campaign have been wishing this in order to weaken Labour. Now they’re using this phenomena to try to frighten the English voter.
The line pushed by the Tories and their friends in the right-wing press is that Labour would be held hostage by the SNP. How 50 odd Scottish MPs could get their way and impose their will on 600 MPs has never been adequately explained.
Government whips on any piece of legislation will deal with all the parties to try to get their bills through the house. Some they win others they don’t. David Cameron was defeated six times in the last five years.
Even Tony Blair with his massive majority was defeated four times. In his three years Gordon Brown was defeated three times.
Clearly the whips are going to have their work cut out if there is a minority government but it doesn’t mean that a minority government can’t function and certainly doesn’t mean that there will be chaos. Of course, they’ll be defeated, but with a fixed term parliament it will be even more difficult to use such defeats to remove the government.
“The Scottish nationalists will impose their views on a Labour governments budget and undo all the economic progress that has been made” – the view of Tories.
Wrong and misleading and shows a complete lack of understanding on the budget rules of the House of Commons. And it is only the Commons, as Finance bills don’t go to the Lords.
Sorry to introduce boring Standing orders into the discussion. But in this case it is highly relevant. Standing Order 48 of the House of Commons states that: “This House will receive no petition for any sum relating to public service or proceed upon any motion for a grant or charge upon public revenue, whether payable out of the Consolidated Fund or the National Loans fund or out of money to be provided by Parliament, or for releasing or compounding any sum of money owing to the Crown, unless recommended by the Crown.”
Put simply, it means, that only the Government that can make proposals to spend money. By convention, this principle has been extended to taxation and the Finance Bills – which are the Bills that authorise the collection of taxes.
So the SNP can huff and puff as much as they like about blocking the Labour budget but only the Government can decide what’s in the budget.
Parliament can only propose and vote on amendments which reduce or remove a tax measure, not increase or create a new one.
So if the SNP and Plaid Cymru wanted to increase expenditure on social security. The only way they could do it is by voting down the whole of the spending plans, or, for example, the Department for Health’s estimates.
That is possible but highly unlikely.
It is quite possible that the Tories would want to vote down Labour’s spending plans but the SNP would have to troop through the same lobby.
The SNP in doing that would have shot themselves in the foot and inflicted huge political damage on themselves? It’s not likely to happen.
Wrapping themselves in flag of Saint George
So why are the Conservatives doing it? Because they’re running scared. They are facing defeat and are desperate. Nothing they’ve done so far has given them an advantage in the polls.
So they’re trying jingoism. Play off the English against the Scots.
But as the Thaterchite Lord Forsyth (former Scottish secretary in a Conservative government) said last week it’s a dangerous game. He attacked his own party for putting electoral tactics above a historic commitment to the defence of the UK union.
Will it work though? Maybe. But voters are not stupid. They’re too sensible to vote for a political party that repeatedly puts itself before the national interest.