Osborne has been in giveaway mode this afternoon, from his tax credit u-turn to increased funding for the Arts Council, but the overall message is one of a chancellor that is sticking to his guns on deficit reduction. 400,000 new homes is a good start to address the nation’s chronic shortage of homes, but it is still well below the annual rate the UK needs.
The lack of concrete reaction in the market is a sign, perhaps, that most investors are quite happy with the maintenance of the UK economy and its recovery. Housebuilder shares are off the highs of the session, as some pre- statement exuberance is trimmed back, since the chancellor was unlikely to unveil anything that would stoke runaway house price inflation. Having steadied the financial ship of state, Osborne now looks to cement his positions as a natural leader for the post-Cameron era. Today’s statement is just one part of that plan.
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