The Treasury Select Committee is set to hear ‘oral evidence’ on Kwasi’s mini-Budget this Wednesday from a panel that looks like it was dreamt up by an FBPE focus group. The Anti-Growth Coalition’s own cast of Avengers…
The Institute for (Big) Government, the Institute for Fiscal Studies and the Resolution Foundation are all sending their star performers to the show. No prizes for what Torsten Bell or Paul Johnson will have to say about a plan that actually supports tax cuts…
Yesterday, IFS director Paul Johnson was one of a minority of wonks to praise Boris’s new social care policy, saying the “world is a better place after today”, describing it as a “progressive and broad based increase”. The PM was so happy with this review he quoted the IFS at PMQs:
“Actually, the Institute for Fiscal Studies has confirmed that this is a broad-based and progressive measure.”
The IFS’ wider response to the policy noted, “those who have more of their wealth in financial assets will continue to be penalised relative to those whose wealth is in the form of their main home – even if the latter’s wealth is much more in total.”
Among other reasons why might Mr Johnson back such a policy? A 2014 Times interview saw the IFS boss actively boasting about his impressive property portfolio:
Six-beds in Muswell Hill now sell for £2,650,000, according to OnTheMarket. Why might Mr Johnson be so supportive of a high-tax system that favours property owners?
The Institute for Fiscal Studies has been allowed a huge quantity of free airtime and column inches in the past few days to bash the Brexit dividend and talk down the economy. The Lobby takes Paul Johnson’s word as gospel. Which is odd, considering the IFS’s record on these matters…
The IFS made a substantial number of predictions about Brexit which turned out to be completely untrue, including:
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That a vote to leave would be “seismic” and that “the economy would suffer… There’s no doubt we’d suffer in the short term”. There was no recession following the UK’s vote to leave; no abnormal change in inflation; no rise in unemployment; and no fall in wage growth…
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The IFS said if the UK voted to leave “the stock market, would dive, making us all poorer”. The stock market has risen to record highs…
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The IFS also said that investment would dry up if the UK voted to leave: “Investment… would fall”. Net foreign direct investment flows from the EU into the UK in 2016 were the highest in 10 years…
The IFS’s forecasts are politically inflected:
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In 2011, the IFS predicted that by 2014/15, absolute child poverty would have risen from 17.5% to 24%. In fact, it fell to 17%…
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The IFS predicted that GDP growth in 2017 would fall to 1.6%. In fact it rose to 1.8%…
A cynic might point out that the IFS admits on its own website that it receives tens of thousands from the European Commission. But on his forecasts alone, Guido isn’t sure Paul Johnson really merits all this media veneration…
Faisal Islam says linking the disappointing 0.1% growth figure to the bad weather is “laughable”. Guardian deputy editor Paul Johnson tweets: “ONS says weather nothing to do with it”. If you actually read the ONS release rather than the Remain spin, they confirm the snow did have a “limited” impact on slowing growth, in three separate ways, on retail trade, petrol sales and construction:
- “some impacts on GDP from the snow in the first quarter of 2018 have been recorded for construction and retail sales”
- “The fall in retail trade was driven by a decrease in petrol sales. This could be attributed to adverse weather conditions, which impacted on travel”
- “There is some evidence of an impact of the bad weather on construction output… 3.3% fall in construction was the largest downward pull on Q1”
The impact might have been limited overall, it’s just not accurate and snow joke for the Guardian to report “ONS says weather nothing to do with it”…
Paul Johnson, director of the Institute for Fiscal Studies, commenting on Labour’s manifesto launch:
“Literally we would not know what we were voting for if we were going to vote for Labour.”
