This morning, we held our first Post-Budget Briefing and the launch for our new book How to Cut Public Spending (and Still Win an Election). The presentation and a brief guide to what all the eight speakers had to say is available over at the TPA website.
The big picture is that the Government have utterly failed to set out a credible plan to deal with the crisis in the public finances. If you want to find out more about how politicians can cut spending and deal with the deficit, then put down the Budget report and read our book. You can download the Powerpoint on our site, with plenty of interesting graphs to get your teeth into. Here are just a few of the interesting findings:
Breaking down the Operational Efficiencies Programme
William Norton's analysis shows that the areas making the biggest savings are the Department of Heath and the NHS, local government and education. So much for the idea that you can't cut spending on schools and hospitals. But, despite all the material out yesterday, he also finds that more than half of the mooted £11 billion savings still aren't identified:
If the interest rate on Government debt goes up, we're in huge trouble
Mike Denham, former Treasury economist and author of the Burning Our Money blog, sets out how - if rates turn out higher than expected (but still well within the historical range) - the cost of servicing the debt could explode. Even if the rates stay low we are still set to spend far more paying debt interest than is budgeted this year for public order and safety:
Fiscal drag is a huge, ongoing stealth tax
The failure to increase the basic rate limit - the amount at which you start paying the upper income tax rate - in line with average earnings is worth £1.2 billion to the Treasury in 2008-09 alone. For the personal allowance, the picture is muddied by the abolition of the 10p rate, and the government's use of an increase in that allowance to compensate low income families losing out. The new freeze in thresholds is on top of a long history of fiscal drag:
