Friday, 19 September 2008

There will be no sacrifices of public services

It had to happen. We knew it would happen, as soon as the mixed messages went out from the campaigns department. Vince Cable and Julia Goldsworthy identified £20bn of extra tax which could be garnered from the fat cats who Labour has allowed to prosper (we will probably find out why, after this sleazy government has been kicked out). We would redistribute this to the least well-off taxpayers, by taking two million people out of income tax and by cutting 4p off the standard rate. No effect on public services, right? (Except the beneficial one of reducing the financial stresses on nurses, junior doctors and council workers, among others.)

They then said that they thought there was another £20bn (see where the confusion comes in) to be found out of public sector waste. Not services, waste. It is the extent to which this money is to be earmarked for improving public services which was at issue in Bournemouth and how much of it was to go towards further improving the lot of the ordinary taxpayer.

The Labour spin machine has leapt into action: "Liberal Democrats will make savage cuts in schools, care homes and the NHS" screams Andrew Davies, AM, clearly reading from a prepared script. He hopes the electorate will forget the closures of schools, care homes and hospitals which Blair and Brown oversaw.

Vince Cable spelt out where the cuts will come: "the unnecessary Child Trust Fund and the means-tested tax credits which extend into the upper income range, ID cards, superfluous and extravagant defence contracts mainly designed to fill the order books of defence contractors, and widening further the bottomless financial pit of the nuclear power industry.

"We've got to stop the gravy train of management consultancy in government; stop questionable government IT projects like that for the NHS and insist that procurement is from the cheapest, open source; and take an axe to the overgrown thickets of quango land.

"The coward's way is to sack or squeeze the pay of low paid public sector workers. The correct way is to start at the top: require every non-front line public sector employee on £100,000 or more to reapply for their jobs. Those allowed back would take a cut in pay and public sector pension entitlement."

I would add that the number of administrators and technicians brought in to the NHS in England and Wales to establish costing systems and the internal market can surely be cut. Either the market is abolished (as in Wales) or the systems are established and merely need to be maintained. It will be interesting to see whether there will be any cost savings at the top as a result of Edwina Hart's centralisation of the NHS in Wales. Experience of previous Labour reorganisations suggests that the existing local health service chiefs will be kept, but that a super administrator will be brought in at the top, with a salary to match. Any savings will be at the expense of operational staff, many of whom have still not received their back pay resulting from the previous restructuring exercise.

So there will be no cuts in services. Indeed, LibDems have already scheduled improvements which Labour had a decade to introduce, but did not, such as reintroducing the link between the state pension and earnings.

Anticipating the next bullet-point on the New Labour list: yes, it will all be costed. Every Liberal Democrat manifesto has been costed, and audited by an independent financial organisation. As our participation in the next administration looks even more probable, so Cable and Goldsworthy will surely make even more certain of their figures.

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