Tim Morgan

At times of economic crisis, successful governments need vision as well as competence. Recent events have called the coalition’s competence into question. What about its vision? As I argue in a new report, ministers have yet to present anything in the way of a novel philosophy. Coalition policies are sold in Labour language, and tested against Labour benchmarks. It seems that Cameron and Clegg aspire simply to be more competent, slightly less spendthrift versions of Blair and Brown. Vision is vital, because a government that is going to rescue Britain from crisis has to stand for something, and voters need to know what that something is. That we are in a crisis is beyond question.

Writing here on Tuesday, I made two accusations regarding the government’s deficit reduction plan. First, I said that cuts so far had been minimal. Second, I argued that higher taxation, rather than cuts in spending, was being used to reduce the deficit. On this basis, I said, government and opposition alike are being mendacious when they speak of ‘savage cuts’ in public spending. In reply, Matthew Hancock said that I was using the wrong periods for comparison. The government, which took office in May 2010, could not be held responsible for spending in 2010-11, so it was misleading for me to use Labour’s last year in office (2009-10) as my base year.

The cuts in spending are going to feel very unpleasant indeed. Rising interest costs, resulting from past expansions in public debt, are going to crowd out other parts of the budget. It is proving difficult to curb the cost of transfers, such as benefits and pensions, and this combines with the ring-fencing of health and development spending to leverage the cuts in unprotected departments. But, as I show in my report published today by the Centre for Policy Studies, the stark reality is that the spending clock is only being turned back to 2008-09, not to the dark ages.   In fiscal year 2014-15 the government plans to spend £758bn, equivalent to £647bn at 2009-10 values.