I would hope, however naively perhaps, that a forthcoming UK government, after the current shambolic one, might take the axe to some of the quangos – quasi-autonomous governmental organisations – that cost so much and do relatively little that is of any use. So it is frankly laughable that the Conservative Party’s idea for controlling public spending (you mean hopefully cut it, Ed), is to set up something called the Office of Budget Responsibility. Oh please. What the heck is the Treasury department supposed to be for? The problem of controlling, and cutting, public spending is both simple and hard: simple to understand – there’s way too much spending, and we need to slash it – and hard, in that it will involve facing down various vested interests. Previous governments that have cut spending, or tried to do so, such as the Thatcher administration, did not have to set up some daft “office” to address the issue.
The trouble with this idea is that it shows how the current Tory party feels it must distance itself from the harsh decisions that will have to be made to shrink public spending from its current horrific levels. But this is an impossible task – far better to be blunt with the public.
Though of course the Thatcher government did not cut spending, though for ever after it has been attacked by those vested interests you mentioned for having done so, when actually what it did was merely restrain the rate of increase a bit. Some quangos were slaughtered, but not nearly enough, and many new ones were created.
What we need is for the whole idea of a quango to be discredited. Fat chance.
Exactly.
It’s Indian Bicycle Marketing of the worst kind. The Tories must know perfectly well that they can cut state spending by a fifth or even a quarter without affecting ‘front-line services’ or even cutting welfare/pensions in the slightest, but they never say it – they don’t even defend themselves when Labour say that the Tories would ‘cut services’.
Summary: the policy differences between the two large parties are so minimal that they define themselves purely by what they allow the other party to accuse them of.
Quite correct Guy – Mrs Thatcher government did not cut government spending.
Indeed even as a percentage of the economy government spending went UP between 1979 and 1983 – only then starting to come down.
However, after the next election government spending will have to be cut – or there will be economic breakdown. The lies about how government spending is “good for an economy in a recession” and how government spending is really “investment” will finally be exposed.
And I mean real cuts in government spending – not “cuts in the increase” or anything like that.
If politicians do not have the guts to cut government spending (contrary to Peter Mandleson it does not take courage to INCREASE government spending, that is easy, it takes courage to cut government spending – and take the political flack for doing so) then they should not stand for election.
The classic statist trap, lure the ants with honey, then watch the ants go ape-shit when the honey is taken away. Lab have been able to milk “Thatcher milksnatcher” for 2 decades, regaurdless of the fact her spending wasnt cut.
Imagine what they would do (and how frenzied the ants would become) if there really was a substantial cut? I think its much more likely Cameron will ride the debt pony to the IMF and blame it on Brown. Then the IMF will be to “blame” for the cuts he wont have the balls to make.
Both your major parties seem to be addicted to being “nice”, treating the dumbed down population as sheep. Whos to say brutal honesty and hard choices will work. Are people in the UK so full of Soma they will cut their own throats?
The IMF is not in a position to bail out the British economy.
Mark Wadsworth:
Sadly you are totally wrong.
I theory you might be right – i.e. it may be possible to make big cuts in government spending without hitting the Welfare State (which is what people mean by “front line services”), but in practice there is no chance of that whatever.
Remember we are facing a budget deficit of something like 13% or 14% of G.D.P. – at a time of sky high taxation.
So, no, admin savings (and whatnot) are not going to be enough at national level.
At local council level perhaps (if we really make an effort) – but the national government starts off with deficit that means that “services” have to be hit. There is no other way to avoid economic collapse and terrible mass suffering.
@ Paul, I’m not talking about “admin savings”, I’m talking about the extra three million taxpayer-funded jobs in quangos and pen-pushing and form filling and so on since 1997*.
They swallow a fifth or maybe even a quarter of government spending. And if you got rid of the form fillers and target setters and so on, the quality of ‘frontline services’ (NHS and education) might even improve slightly.
That gets rid of two-thirds of the expected Budget deficit and stopping other planning increases (which also make up two thirds of the expected deficit) gets us into a slight Budget surplus.
And call me soft, but welfare spending of £20,000 to keep one household in fags and beer for a year is far better value than one or two months’ worth of Trevor Phillips’ salary plus pension plus perks, for example.
* OK, two million extra since 1997, but there must have been at least one million too many already. There are less than two million teachers/nurses/doctors/coppers/soldiers, and over six million ‘other’ on the public payroll. What do the six million ‘other’ do all day long? For sure, schools and hospitals and prisons need maintenance staff, and cooks and cleaners and so on, but surely not three of them for every one ‘frontline’ worker like teacher/nurse etc.
Mrs Thatchers enduring achievement was effecting a change in the national mood. Does anyone really believe that a Cameroon government will cut public expenditure? No doubt they will be forced into doing so, which means it will be shambolic. The only way to cut public expenditure is to STOP the government doing things.
Mrs Thatchers enduring achievement was effecting a change in the national mood. Does anyone really believe that a Cameroon government will cut public expenditure? No doubt they will be forced into doing so, which means it will be shambolic. The only way to cut public expenditure is to STOP the government doing things.
Paul: Another inportant factor is the people having to make the cuts; if you were a classic statist apparachnik would you rather admit all that state spending is pointless and can be cut without pain (by targeting the expensive “services” no one wants), or make damned sure iit hurts by targeting nurses (preferably young & pretty for the cameras), teachers and others who enjoy public sympathy and are more visible.
Mark: Following a visit & speech by Osborne in Witney I handed him a letter pointing out the increase in the public payroll; that this is only half the story because of all the jobs moved off balance sheet; that average public sector salaries are about £30k; and suggesting then that maybe there was scope for tax cuts after all (admittedly this was before Brown’s last borrowing binge). Having chased his office for a response and sent another copy of the letter (trouble maker won’t go away) I received a bland reply indicating that Mr Osborne generally approves of motherhood and is quite partial to the occasional slice of apple pie.
Even if you say 1/3 of a public sector salary is recycled through tax and NIC that is a net cost of £20k/head. With 2m heads we’ve just saved £40billion per year without touching “front line services” (which I would happily touch).
Mark Wandsworth one can indeed save a bit of money by abolising “Regional Government” and other such stuff.
However, you are totally wrong in thinking that cuts in so called “front line services” can be avoided at the national level – there is no chance of that whatever. Whoever is elected – for Labour (contrary to the lies of Mr Brown) will have to do it also.
“By the way”
I heard this morning that the Supreme Court of the United States has refused to hear the Chrysler case (“well at least they did not rule for Obama”) – this means that not only the protection the United States Constitution grants to private contracts is now worthless, but also that two hundred years of “precedent” (the normal excuse for not following the text of the Constitution) is worthless as well.
This is a much wider matter than most people understand – it means that all bonds (Corporate, local, State AND Federal) are no longer backed by the rule of law. And also that private contracts are no longer going to be upheld.
Remember if the State of Indiania can not get justice – a private person has no chance.
Sell all American bonds now.
Sell them even if you get only a few cents on the Dollar.
Sell, sell, sell.
Mark E, Keep up the good work with Osborne.
The tax that state workers notionally pay is a red herring, as it more or less nets off with the value of their pension promises. And you can add on all the costs of office space and the corresponding burden on the private sector who have to fill in the forms. I have looked at a lot of different calculations and estimates and the possible savings are in the region of £100 billion (large margin of error), i.e. approaching one-fifth of current government spending, and twice as much as the cash cost of the welfare state.
The opportunity cost of the welfare state would best be reduced by reducing means-testing, which ultimately would reduce the cash cost and/or boost tax receipts elsewhere.
Good point on the pretty nurses, of course, that is always how they play it, given that three-quarters of NHS employees are neither nurses nor doctors.
One of the problems of the ‘no cuts in front line services’ mantra is how you define front line services.
For most of us the definition is obvious. Doctors, nurses, police, firemen and the like all qualify. For the statists, (in or out of government), front line services are those where cutting them would upset particularly vociferous pressure groups and lobbies from the govenment funded ‘charities’ and quangos we contribute so much to.
I refer, of course, to such essential people as outreach co-ordinators, diversity councilors, multi-culturalism experts, ‘alternative’ medicine practioners and the directors and workers of those self same fake charities and quangos. After all, this is where the up and coming statists get their grounding, and where the has-beens and never weres retire to leech off the taxpayer.
Too many jobs for the persons at stake if we cut those.
Sean Gabb has studied this question and delves into it at length in his book about the ‘Culture War’. Go to seangabb.co.uk -> ‘Read my Latest Book’.
His prescription is to shut down ALL the quangos, NGO’s, AND the ‘chattering classes’ including the BBC *ALL AT ONCE. Since the screaming will be just as loud when 2 quangos are slaughtered, might as well go for 1,000 or 2,000 all at once. (Does anybody really know how many there are?). And that includes all funding to nominally independent charities.
I strongly suspect that a substantial proportion of the population would strongly back such action.
Note that ‘front-line services’ including welfare are not to be touched. In fact, they will be needed, since it is unlikely that all of bureaucrats will find gainful employment immediately.
I would not make any bets however that the Cameroon will take this course of action.
As far as I can recall Mrs. T imposed cash limits in the attempt to control public spending. In as much as it succeeded (and we’ll never know what would have happened without her- my guess is that public expenditure would have risen further and faster) she still left all the machinery in place to beg money off her successors. If expense is to be cut long term then whole functions have to be cut (or privatised), by no means can all government supplied services be called front line. There are indeed many quangos that are ripe for such treatment- and the proposed introduction of education vouchers should enable the elimination of the department of Education (a few treasury staff should be able to dispense the vouchers and standards will be monitored by parents).
Whatever the details, cash limits can only work with an Iron Chancellor at the helm and will rapidly be breached on his removal- it has to cuts of entire functions.