It beggars belief that opinion polls still indicate that Chancellor George Osborne is trusted more over the economy than his shadow Ed Balls.

Every economic forecast made by Osborne over reducing government debt, which he made his central policy plank, has proven to be the stuff of fantasy.

Despite an apparent economic recovery, largely funded by a house-price bubble and increased household borrowing, lower official unemployment figures have not translated into a surge in tax income.

This is not surprising given the huge increase in self-employment, zero-hours contracts and a plethora of low-paid, part-time, temporary and precarious jobs.

The story of this government is one of relentless impoverishment of the working class, a chronic failure of wage levels to catch up with inflation.

Raising the threshold level at which people pay income tax means that many workers entering the world of paid work do so at such low wage rates as to have to claim in-work top-ups such as tax credits and housing benefit.

Although it is individual workers who submit these claims, they are effectively state subsidies to the capitalist class which pays wages that people can’t afford to live on and to landlords demanding rents beyond tenants’ ability to meet.

Osborne has been single-minded in his determination to impose austerity on this country, claiming that reducing expenditure on public services, holding down workers’ pay and degrading retirement provisions was the only viable way to reduce the deficit.

At the same time, he found sufficient spare capacity to slash direct taxation for the tiny minority of the population with annual incomes of over £150,000, prompting charges of hypocrisy and incompetence.

Hypocritical he certainly may be but not incompetent. He should not be judged on the basis of his public pronouncements to the gullible.

The Chancellor must have known that squeezing the purchasing power of working people would throttle the economic recovery that was already in train following the 2008 global financial meltdown.

However, his major goal was not to encourage demand as a means of stimulating employment and driving up the pay and conditions of working people.

The Tories and their loyal Liberal Democrat Orange Book allies were united on the priority of transferring wealth and power from the have-nots to the haves.

And that is what they have achieved, with the capitalist class increasing its share of national income.

Osborne’s announcement of a £2 billion annual increase to protect frontline NHS services is a panic move intended to assist the Tories’ general election chances.

It will be paid for by swingeing cuts imposed on so-called “back office” costs at the Department of Health and cuts in welfare spending, including a 10 per cent reduction in child benefit.

Balls says that he might have to rethink his pledge to match current government spending on the NHS and to boost it by a further £2.5bn in 2016.

Labour’s thinking on the economy certainly needs a shot in the arm, based as it has been on sharing the Tory obsession with reducing the deficit by attacking jobs, services, pay and pensions.

The past four decades have witnessed an inexorable transfer of resources from the working class to the men of property.

Labour should dispense with the political timidity that has accompanied its economic orthodoxy and rally its present and potential supporters by proposing a taxation approach to redress the historic dispossession of the working class.