Last week Mervyn King told us that the "nice decade" was over. David Cameron is set to deliver the same message later today in a major speech in Birmingham. According to reports in the Telegraph, Independent and Daily Mail the Conservative leader will say:
"After a decade of reckless spending under Labour, Britain needs good housekeeping from the Conservatives. We need to start living within our means."
The FT reads David Cameron's words as an echo of "Margaret Thatcher’s homespun 1981 refrain to “live within your means [and] put a nest egg away for a rainy day”."
His speech will have the following main messages:
- Taxpayers "can't take any more pain": "We have reached the limits of acceptable taxation and borrowing" and must now "create the space for cutting tax".
- Economic competitiveness is imperiled by Labour's tax burden: "The economy can't take any more pain without losing jobs to lower tax competitors."
- Conservatives will bring spending under control by tackling three leading causes of rising spending:
- Social breakdown including family breakdown, unemployment, drug and alcohol addiction;
- Top-down state monopolies;
- Waste and bureaucracy.
- Hints of spending priorities: Although Mr Cameron has previously said that the NHS will always be at the front of the spending queue for a Conservative government he will acknowledge particular pressure on "essentials" such as care for the elderly, equipment for the armed forces, prisons and the police.
1.45pm: Some key quotations from DC's speech:
- The contract between taxpayer and government: "Labour have broken the basic bargain between government and the people, the bargain that says: "We'll take money off you in taxes, and you'll get decent quality services in return.""
- The scale of Labour's waste: "It's clear that we now have in power in this country a bunch of Labour politicians who are just shockingly casual about public money and how it's spent. £20 billion wasted on an NHS computer that still isn't working properly. £2.3 billion spent refurbishing the offices of MOD civil servants. And in one year alone nearly £2 billion of tax credits lost due to fraud and error."
- Good public services aren't cheap: "We understand that you can't get decent quality on the cheap. We will give public services the proper funding they need so that everyone in the country can have access to the services they need. As I've said before: no ifs, no buts, no opt-outs."
- Sustainable low taxation in the long-term: "We are the party of low taxes for the long term, not tax cut promises for the short term."
- David Cameron - ditching the approach of the James's Report - then set out an alternative three-pronged approach to cutting the size of the state:
- Reducing the demand for government: "The first way in which we will control public spending is to reduce the long-term demands on the state. We need to tackle the causes of the social problems that give rise to public spending in areas like welfare and crime. That means taking forward the work that began with Iain Duncan Smith's magnificent Policy Group report, Breakthrough Britain."
- Ensuring that the public services make better use of taxpayers' money: "The second way in which we will control public spending is by carrying out the work that was the great missed opportunity of the Blair and Brown years - proper public service reform. Unlike the Labour Party, there is no internal feud or ideological war preventing us from carrying out the reforms that everyone knows are needed."
- The need for a more businesslike Whitehall: "The third component of our strategy is cut out waste and make government more efficient. That is one of the principal responsibilities of Francis Maude and his implementation team. This is a really significant commitment for us... Francis and his team will be looking at government efficiency right across the board: procurement, staffing, structures - everything you would expect from a modern, professional and businesslike operation."
- Concluding soundbite: "It used to be said that "good food costs less at Sainsbury's." Well I want good services to cost less with the Conservatives."