Within days of the next election, whoever is elected, an announcement will be made that some tens of billions of pounds have to be found to reduce the deficit, the difference between annual government expenditure and annual government income. Estimates range from £40 billion, according to the IFS, to £100 billion, according to Malcolm Offord's Bankrupt Britain report. Whilst tax rises might contribute to some of this total the vast bulk of the work will have to be done by spending cuts, or savings as we are given to calling them in local government. ConHome's own Tim Montgomerie has said that tax rises should be a last resort after possibilities for spending restraint have been exhausted. 86% of Tory members agree.
On the Right we are told that it is impossible to cut public expenditure or at least it is very hard to make any headway. But the Left needs to accept that raising taxes is hard, if not harder. The public may well already be at the point where the pips are squeaking. Up until the “Credit Crunch” we had got to the point in public discourse in this country that even reductions in planned spending increases are described in lurid terms as cuts. Since then even voices in the Labour party have accepted that the burden of state spending weighs too heavily on ordinary people. We might as well use the “c” word and have done with it. Whatever your political outlook the only question is the degree to which public expenditure needs to be cut.
The economic cycle dictates that spending needs to be constrained from 2010/2011 but it is unlikely that an election will be called until the last possible minute in May 2010. Therefore the axe will not start to fall (enough) until 2011/2012. In the meantime we will have two Panglossian budgets that will attempt to ignore the size and speed of increase of government debt. The need for radical action on government debt will be all the more necessary for this delay.
This new ConservativeHome page is an attempt to start the debate now on how our next government can bring public spending under control in a politically acceptable way. We would be quite happy if our current government takes up some of these ideas. The pain will be less the earlier we start this process.
In order to gauge the acceptability of our ideas we will use a traffic light system of classification. Green for ideas that are essentially “no-brainers”; ideas that anyone would think sensible and which would be uncontroversial. Amber for ideas that would come in for criticism but would be essentially deliverable without undue concern. Red for ideas that would be simply too hard, either because they would be impractical or politically unacceptable.
Some of the ideas we present will be but tokens, the odd few £ million here or there that will not really help us to find the £ tens of billions required. But sometimes tokens are important so we will include the little ideas along with the big ones.
This process is meant to be interactive. There are two ways you can get involved. Firstly, in the comments please pull our ideas apart, add information and rate our ideas as follows: Green: No-brainer, Amber: Persuasion required, Red: Too hard. Secondly, submit your own ideas to the Star Chamber (via [email protected]). Ideally they will be worked up and ready to publish but we can help you polish them for publication.
Submissions should attempt to identify the budget you want to examine from published sources, the activities you think should be curtailed and their value and any risks or downsides in taking the steps outlined.
There are a maximum of 381 days from today [20th April] until we have a new government. Let’s get to work. We are going to begin this week - tomorrow - with four cuts from the think tank Reform. But just to get you going here is one small and topical idea: Halving the cost of ministerial Special Advisers.
Phil Taylor, Editor of ConservativeHome's Star Chamber blog
