Deficit reduction will still be top of the list but Osborne could also cut fuel duty and row back on green targets
There are certain courses of action that George Osborne is sure not to take on Thursday. For example, he will not stop ringfencing health and aid spending. And he will not scrap the Climate Change Act, as Simon Richards urges on ConservativeHome today. (Simon is of course right to suggest that the driver of some green taxes is green targets.) The chancellor will not means-test the winter fuel allowance or free bus passes or free TV licences for older people. The list below consists of actions that he could take.
• Build more homes on publicly owned land: The only way of both getting more homes built quickly between now and the next election while minimising rows with local councils (many of them Conservative) is to build on land that the government already owns, is making no use of, and doesn't need. Downing Street needs to lead a drive to get departments to let the land go. (The government claims that it will have released land with capacity for 62,000 homes by 2016.)
• Cut NI contributions: As Peter Hoskin reminds us today, the chancellor announced an NICs cut in the last budget. The employment allowance let all companies off the first £2,000 of their national insurance contributions – eliminating the bills altogether for 450,000 firms and a third of all employers, according to the Treasury. Increasing the allowance to cover more firms and employers is an obvious course to take.
• Move to cut tax on cash savings: Osborne is in no position to scrap benefits for better-off pensioners, given Conservative campaign pledges at the last election, but there's no reason whatsoever why he shouldn't announce a review as a way of preparing the ground. The Liberal Democrats would not object. That would allow him to move towards the bargain that Liam Fox has previously floated– scrapping the benefits but abolishing tax on cash savings in banks.
• Public spending commission: As I wrote yesterday, the Conservatives don't have the political credibility to consider, let alone implement, ideas that must be on the table if we are to have – as ConservativeHome has put it and the chancellor now phrases it – "affordable spending" (and nor has any other party). These include raising the age at which the state pension is received further, and looking at co-payment for healthcare.
• Cutting fuel duty: As Peter Hoskin also points out, Osborne pledged at party conference in the autumn that it will be frozen until 2015 dependent on the money being found. Much depends on the growth figures, but if the chancellor can find room for manoeuvre he ought to confirm that the cut will happen, and even make a modest cut if possible. With the possible exception of utility bills, nothing will be pressing voters in those northern and Midlands marginals more.
• More nuclear power: Today's Telegraph returns us, amid the noise of battle over green taxes and levies, to the fact that the lights may go out next winter. The government ought to be slowing the green targets that are making the prospect more likely. Since that won't happen with the Liberal Democrats on board, and nuclear must play a role in keeping those lights on (in the medium term, anyway), Osborne ought to spell out what his next nuclear plans are.
• Deficit reduction, deficit reduction, deficit reduction: I opened with a reference to Simon Richards's ideas, and close with one. Like Peter Hoskin, Simon is right to put continuing deficit reduction at the top of his list: indeed, today's Financial Times suggests that though the growth news for Osborne will be good, it won't be too good. Obviously, he won't simply leave taxes as they are: there are bound to be some reductions. I have restricted myself to two.