Chancellor of the Exchequer
George Osborne started 2010 in the Conservative shadow cabinet as David Cameron’s less convincing Tory-boy sidekick, but ended it doing a very convincing job as the UK Chancellor. As author of the so-called austerity Budget, Osborne has been the key decision maker on making cuts to public spending. So far he has impressed business leaders, including the great and the good of the fashion industry, with his well thought out decisions and by sticking resolutely to his guns. A few took issue with the decision to redivert corporate green tax back to government coffers, but most hailed Osborne as “brave” and “fair”.
More significantly, the decisions the Chancellor has taken - to increase VAT to 20% in January, to slash 330,000 public sector jobs, and to cut myriad benefits including child benefits for middle and higher-income earners - have already had a significant effect on consumer confidence in some parts of the country. Osborne’s public sector cuts - or rather shoppers’ anticipation of the gory details - were the primary reason for the early autumn sales lull felt by most retailers, and towns and cities outside London have been hammered. His decision to delay the VAT hike until the new year should at least ensure retailers have a much-needed happy Christmas ahead of a painful first quarter.
Osborne has had a profound effect on retail before any of his cuts have even taken place. Whether his tactics ready the UK for growth or tip us into a double-dip recession remains to be seen.