Blast from the Past

The countdown to redundancy for everyone left in my office now stands at 8 working days. Accordingly, desks are being cleared out and many things unearthed. I have, for instance, found a copy of the FT from April 26th 2010 with an article about 'The Demolition Job that Awaits the Next Government'. With hindsight, it is rather striking.



Apologies for the poor quality cameraphone photo. The main point of the editorial on the left is that £37 billion of savings will need to be found from the public sector in order for the deficit to be halved by 2014. It is noted below the pie chart that all three political parties have failed to identify anything like that level of cuts in their announcements to date. Incredibly, of the three it was the Conservative party that had at that time announced the smallest level of cuts. £7 billion a year, to be precise.

The FT's modest proposals for cuts were as follows:

• Axe two aircraft carriers, which has not occurred.
  
  
• Reduce prison numbers by 25%, which has has not occurred, although Ian Duncan-Smith did entertain thoughts in this direction. Then came the wrath of the Daily Mail, and the riots. Thus the prison population has reached a record high.
  
  
• 5% cut in public sector pay for a year, which has not occurred, as the FT high-handed assumed that central government could just do this whenever they wanted. Which wouldn't be very localist, frankly. Public sector pay has been frozen, though, and with inflation running at 4.5%, that amounts to a cut in real terms. Moreover, there are now 240,000 fewer jobs in the public sector than there were last year.
  
  
• Means test child benefit, which is in progress.
  
  
• Scrap winter fuel payments and free TV licenses. Wow, the FT really cares about the elderly. This hasn't happened and there are no plans to do it. This government is far keener on withdrawing support from the young.
  
  
• Halve spending on NHS dentistry. Here is a rich irony for you, as this is presumably predictated on NHS dentistry being inefficient. It is one of the areas of the NHS run on more competitive, private sector lines. The government is now planning to bring that same ethos to the entire NHS in the health and welfare reform bill. Will the result be cost savings, chaos, worse health outcomes, or none of the above? Who knows - certainly not the government.
  
  
• Stop primary and secondary school building for three years. There is more irony to be found here. Building Schools for the Future was scrapped, and Local Authority budgets cut so that any new schools would need to be developer funded. However, the Free Schools policy will mean more schools coming into being. Is money being saved overall? The Department for Education took a smallish budget cut over the spending review period, so presumably that's the idea.
  
  
• Halve spending on Teaching Assistant salaries. Again, the FT is getting a bit high-handed if it thinks central government can just reach down into schools and fire half of their TAs. That said, many such jobs are probably looking less secure as schools look to absorb funding cuts.
  
  
• Cut funding to Scotland, Wales, and Northern Island by 10%. The government went for 7% overall.
  
  
• Halve spending on road maintenance and upgrades. This takes in two sets of cuts; to the Department for Transport (which is responsible for trunk roads) and to upper-tier local councils (which are responsible for local roads). The former took a 12.6% cut, the latter about 26% cut. A number of planned major motorway upgrades have been ditched and many local authorities have cut their pothole budgets. Whether this amounts to halving spending is hard to tell.
  
  
• Delay Crossrail for at least three years. This has not happened; Boris managed to save Crossrail from the axe.
  
  
• Withdraw concessionary fares for pensioners. The FT does seem to have something against the elderly. This has not happened and is unlikely to.

Abolishing the Child Trust Fund and Education Maintenance Allowance were also mentioned in the article - both of which are happening.

That amounted to £37.4 billion cuts over four years. In the Comprehensive Spending Review the government announced £83 billion cuts over four years, more than twice as many. Quoth the FT on April 26th 2010:

Spending cuts on the scale outlined in the Financial Times' analysis appear too politically risky to contemplate

Excuse me while I laugh bitterly. The FT proposed instead to raise income tax and VAT. The coalition have done the latter, but also cut or frozen the budgets of all government departments. Significantly, they have laid particularly hard into the welfare state, which the FT treated as sacrosanct.

What a change in just over a year. I suspect that the 'political risk' the FT mention was simply steamrollered by shock and awe tactics. The public sector must be cut immediately or the country will run out of money and citizens will have to start eating one another! (Only a slight exaggeration of the Spending Review rhetoric.) I think the FT underestimated people's apathy and lack of awareness of what the public sector does. Few protest when told that a government department's funding is being cut by 20%; it just seems like a number. When that means a fall in income or the closure of a local service, complaints start. By then, it is probably too late.