United Kingdom: the Autumn Declaration was an act of illusionism

By Julio Santana – ISL UK

The Conservative government took measures to try to take pressure off the social situation. In reality, it is a plan at the service of businessmen and the City. Supporting the struggles and demanding a general strike are tasks that cannot be postponed. Faced with the scam of the Tory and Labor duopoly, a new left alternative is needed.

Like a magician, Rishi Sunak wants to sell to us that the Autumn Declaration, presented with Chancellor Jeremy Hunt, represents the Tories’ compassionate side. But the reality is that the UK faces the biggest blow to people’s living standards, as Hunt set £30bn in delayed spending cuts and £25bn in retroactive tax increases. The Declaration exposed the serious economic situation of the country. The OBR (Budget Office) stated that the economy entered a recession that could last more than a year and would lead the economy to contract by 1.4% in 2023. To respond to the difficult social situation, the Tories made decisions to favor the powerful and trey to accomodate the poor with some social barnish.

To comfort financial markets,

Hunt slashed the budgets of Whitehall , expanded the scope of the special tax on energy companies, extended the tax break freeze, lowered the threshold for paying the 45% tax rate on rent to £125,100, gave local authorities the go-ahead to raise council tax and raised more capital gains tax and inheritance tax. These decisions are part of a plan to convince financial markets, to which Prime Minister Rishi Sunak answers, of the government’s intention to reduce its budget deficit.

To calm social spirits

At the same time, Hunt postponed most of his tough measures to 2024-25. Spending on the NHS and schools increased. He promised to increase pensions according to inflation. Help for household energy bills was extended beyond April for one more year through the energy price guarantee. From April, the national living wage will increase by 9.7%, with a rate of £10.42 an hour implying an annual wage increase of more than £1,600 for a full-time worker. The internal measures are in sync with the new conciliatory everything adopted by Prime Minister Sunak externally with the EU, Ulster and China.

“Progressive” Conservatives?

Nothing further from reality. The measures were presented as a limitation to the enormous profits that large companies have been accumulating. The reality is that profits are not beeing touched. One can take as an example the increase in the tax burden for electric companies. It was settled after reassuring them of two things: the first is not to touch the 80% increase in bills that they imposed before Liz Truss’s Mini Budget. The second is that, beyond “help” in the energy sector, the costs of the average annual bill increase, which goes from 2,500 to 3,000 pounds. More than aid to households, are transfers to companies, which will reach their coffers practically free of windfall tax.

The increase in pensions and the minimum wage is also a hoax. The VAT is not touched, the tax with which the people in any country supports the State budget and, in addition, municipal taxes are increased. The harsh reality is that: “Rising prices erode real wages and reduce living standards by 7% in total over the two financial years to 2023-24 (eliminating the growth of the previous eight years), despite of more than £100 billion of additional government support. The contraction of real incomes, the increase in interest rates and the fall in housing prices weigh on consumption and investment, leading the economy into a recession that will last just over a year starting in the third quarter 2022, with a drop in GDP of 2 percent. Unemployment increases by 505,000 from 3.5 percent to a peak of 4.9 percent in the third quarter of 2024.” (Office of Budget Responsibility 11-17-2022)

The untouchable City, health and education with the usual deficiencies

In the article “A rich prime minister so that there are poor people” we said that the City, the financial and speculative heart from the UK, was happy with the arrival of one of his men at 10 Downing Street. And we are not wrong. There is not a single measure that attacks the privileges of bankers. On the other side of things, the increases in the health system and education are absolutely insufficient and do not resolve the lack of funds suffered by these public services after 12 years of conservative governments.

The Labor Party just waiting for the elections

Following its role in bipartisanship like a shadow to the body, the Labor Party hopes that the government falls into its hands, like a ripe fruit falls from the tree, without shaking it. Rachel Reeves, the shadow chancellor, said: “What people will be asking at the next general election is this: are I and my family better off with the Conservatives? And the answer is no.”

This is all they have to offer. A two-year wait with the Conservative government. They wait for the repeated alternation in power and then say: “The inheritance received is very heavy, we will do what we can.” Or worse, they will repeat what Labor did in 1997, when Tony Blair and Gordon Brown promised to stick to Conservative spending plans

For a general strike and a left-wing alternative

Many unions are voting en masse to strike with grassroots momentum, as happens between the university workers, the Union of Communication Workers and others. It is a task of the workers and the people to support those who fight. It is also necessary to discuss how to move forward, because it is impossible to wait two years, as Labor proposes. Why don’t the leaders call a general strike? We must demand that they coordinate their struggles and call a general strike with mobilization for workers’ wage and labor demands and for the crisis to be paid for the capitalists. The Conservative Party and the Labor Party are the two legs of a two-party scam, which alternates between them in power to maintain the status quo, favor corporate profits and unleash austerity measures on the people. It is necessary to build a new anti-capitalist political tool of the left to break the vicious circle of bipartisanship on the path to a socialist exit.