The Government has a cunning plan to get ‘down with the kids’ – it will backfire spectacularly

When ministers discussed when to formally end the seven-year clampdown on public sector pay, it seemed a cunning plan to do it on the day Jeremy Corbyn addressed the TUC conference on Tuesday. Their hope was to spike Corbyn’s guns and make trade union threats of strikes over wages look unreasonable. With tight Commons votes looming, the Tories’ Democratic Unionist Party allies gave them a timely nudge on public sector pay.

The plan wasn’t as clever as ministers thought. Corbyn tweaked his speech to demand that the 1 per cent pay cap be lifted across the public sector. The wind was not taken out of the unions’ sails either. The Government’s climbdown looked grudging; a one-off rise for police and prison officers that fell a long way short of the 2.9 per cent inflation rate announced on the same day. Bad rather than good timing after all.

So the Tories will get little credit for their apparent step away from austerity. The Chancellor Philip Hammond, who has a deficit and a Brexit effect to worry about, has insisted that the new “flexibility” on pay must be funded from existing departmental budgets. Unless he finds new money in his Budget on 22 November, next year’s public sector wage rises will result in cuts to services and/or jobs. One way or another, austerity will last, at least while the Tories hold on to power.

True, they are trying to learn lessons from the June election debacle. But Corbyn’s response on pay showed that the Tories will not easily escape their own spending straitjacket (which will still not clear the annual deficit until 2025 at the earliest – 10 years later than they promised). The Labour leader will always be able to outbid the Tories; if they find a magic money tree, he will find a bigger one. The Tories’ problem is that dire warnings about Labour wrecking the economy may fall on deaf ears.

And telling voters that they are clearing up Labour’s mess, as ministers have again been doing this week, will not dent Corbyn’s appeal. It wasn’t his mess, and they have been in power for seven years.

The Tories may be about to repeat the mistake as they prepare to unveil a package aimed at wooing young adults – another response to a June election which showed that age is now a bigger influence on how people vote than class. We can expect a cut in the unfair 6.1 per cent interest rate on student loans and more measures to help Generation Rent get a foot on the housing ladder.

Such moves would be welcome but again may not measure up to the scale of the problem. A better way to help twenty-somethings would be to increase the £21,000 salary threshold at which graduates start to repay their loans. This was supposed to rise each year in line with earnings but has been frozen since 2015. Whatever the Tories do, they will not compete with Labour’s pledge to abolish tuition fees. It is pretty much an £11bn bung to the middle classes that could be better targeted on the disadvantaged, but has the virtue of being easily understood – and liked – by voters.

Labour has now translated the professionalism of its election campaign to Parliament, where it was often amateurish after Corbyn became leader two years ago. Today, for example, the Opposition has tabled two Commons motions that will force Tory MPs to vote against a Labour plan to halt a rise in tuition fees to a maximum £9,250 a year and to lift the pay cap for NHS workers. Clever politics.

With hindsight, ministers now believe housing was a much bigger issue at the election than they had expected. But a serious attempt to tackle the housing shortage would involve building in the Green Belt. Some ministers and Downing Street advisers now acknowledge this. But will Theresa May really take on the Nimbys? She should. It would be a powerful signal that the Tories no longer pander to their elderly support base.

The Tories need to realise that “young adults” are not a block of voters that can be moved from one column to another at the flick of a switch. The “tipping point” age at which people were more likely to vote Tory than Labour in June election was not 27 but 47. Like the NHS and creaking social care system, the Conservative Party is facing its own demographic time bomb.

To ensure their own long-term survival as a party capable of winning elections, what the Tories need to do is not to hand out more sweeties during the party conference season, but to use the levers of government to tackle the corrosive generational divide.