After yesterday's remarks on security issues - in Leeds - David Cameron focused on the economy today during visits to Cambridge and Hertfordshire. This is the second of his statements on the 'five big challenges facing Britain'. Mr Cameron emphasised three economic priorities:
(1) A less regulated economy. Acknowledging that he's not the first Conservative politician to make this promise, Mr Cameron said: “I’m not going to make simplistic promises about cutting red tape. Politicians have been saying that for years. The truth is that we will never succeed in cutting back regulation unless we change our society’s attitude to risk. We need to treat adults as adults and change our risk-averse, compensation culture. That means a major culture change in this country, a change that I want to lead." Oliver Letwin, an early supporter of DC, gave a big speech ('Nothing Ventured, Nothing Gained') on risk some time ago and his approach might be inspiring Mr Cameron now.
(2) Competitive tax rates and first-class public infrastructure. In a classic example of triangulation Mr Cameron positions himself between "Labour’s extreme approach, which is to take all the proceeds of economic growth and spend it themselves" and a more ambitious tax cuts policy (perhaps of the kind we expect to hear from David Davis tomorrow). Mr Cameron's middle way is "to share the proceeds of growth between tax reduction and public service investment". "Education and transport are," he says, "vital components of a long-term economic policy. How will we compete in the world unless we have a well-educated workforce and the best graduates? And how will our economy work properly if we don’t solve our transport problems which make it such a hassle for people and goods to move around? We need to invest in these areas while keeping down the burdens on the state. That’s why we have to take tough decisions like supporting tuition fees for higher education and charging for new roads." This is Mr Cameron's co-payment idea. He concludes on tax: "It’s just irresponsible to pretend that we can get good public services on the cheap, or that short-term tax cuts are all we need to do to build a competitive economy."
(3) The third priority is pensions. DC: "If we don’t sort out our pensions crisis, our economy will be crippled by the additional burdens that will fall on the taxpayers of the future. Labour are ducking this challenge, and we must not. I will launch a thorough-going review of pensions policy, based on long-term considerations rather than short-term electoral advantage. This will involve making tough decisions. We need to be sure that a Conservative Government after the next election is equipped to provide Britain with a state pension system and a framework for private pensions which, together, restore the incentive to save, eliminate unfairness for women, and give everyone a decent income in retirement."