Ryan Bourne 2

Ryan Bourne is the Head of Public Policy at the Institute of Economic Affairs.

In an ideal world, we’d all prefer the parties to spell out in advance exactly what they are going to do after an election. The side-effect of not being entirely honest, though, is that other parties are able to speculate as to what you might do in office. So, to a certain extent, the Conservatives cannot complain when the Liberal Democrats suggest their planned £12 billion cuts on working-age benefit spending may come from tax credits or cuts to child benefit.

Yet I had to chuckle when I saw Nick Clegg on BBC Question Time claim that “they [the Conservatives] are going to take the equivalent of £1,500 off 8 million of the most vulnerable families in this country”. Let that sink in for a second. Eight million of the “most vulnerable” families. The Office for National Statistics helpfully informs me that there are just over 18 million families overall in the UK. So Nick Clegg has decided to associate 44 per cent of families in the UK with the ‘vulnerable’ term!

One might say that the term ‘most’ means Nick Clegg has not been dishonest here. But if a politician were to use the term ‘richest’ to describe the top 45 per cent of the income distribution, at best you would think they were being misleading. In this specific case, you may well think Nick Clegg’s rhetoric is a sad indictment of the tax credit system too…

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UKIP should be commended for having their election manifesto independently audited by the CEBR – a respected economics think tank. In doing so, they have proved the bankruptcy of Ed Balls’ call for all election manifestos to be audited by the Office for Budget Responsibility (OBR).

Why? First, because they have shown that an appeal to state resources is not necessary to obtain credibility from an outside institution. Second, because the reaction to it by some journalists (in challenging the assumptions made by the CEBR) showed that the effects of policies are highly uncertain and debatable.

Attempting to impose some form of objective truth through the OBR would thus not improve public debate, but rather stifle the clash of ideas, theories, and expectations of the effects of policy which a healthy democracy needs. Where manifesto accreditation is concerned, we do not need a state monopoly. Let a thousand flowers bloom.

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There was a lot of hand-wringing last week about the ‘irresponsibility’ of the Conservative pledge to not increase income tax, national insurance, or VAT. Many lamented that these pledges were dangerous at a time when the UK was still borrowing circa £90 billion per year. Yet where was this cacophony of noise as all parties pledged to ring-fence huge areas of spending – the NHS, the education budget, all pensioner spending and foreign aid? It seems that, for many at least, pledging to spend more of your money is reasonable and politically sensible, but pledging to allow you to keep more of your own earnings is dangerous and irresponsible.

I’m not sure why we see this asymmetry. Perhaps it’s just ‘status quo bias’ – i.e: people can’t envisage public services being delivered any other way. I’ve personally not got anything against pledges either way – I just happen to think that many of the spending ones (the triple-lock on the state pension and ‘ring-fencing’ simply for the sake of signalling your commitment to an area) are bad policies. There’s a political dimension to this too, though. As Nick Clegg and George H Bush have shown, pledges become a problem when you break them. So, the key lesson is: don’t make pledges you can’t keep.

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The SNP has probably pulled off one of the greatest deception tricks in the history of UK politics. Somehow, they’ve managed to present the Labour party as an ‘austerity’ party but themselves as ‘anti-austerity’ insurgents.

Whilst it’s beyond this column to analyse the fiscal plans of all the parties and to declare whether they are deserving of these titles, one quick glance at the two parties’ approaches shows the difference between the two is paper thin.

The IFS analysis, for example, shows that by 2019/20 the national debt as a proportion of GDP is forecast to be 77 per cent of GDP under Labour’s proposals and….wait for it….78 per cent of GDP on SNP policy. Scottish left-leaning voters are hardly spoilt for choice.

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Of all the debate about policy areas, that of healthcare is surely the most impoverished. I took part in a Newsnight discussion on the future of the NHS last week, and as ever the whole programmes was pretty much focused around inputs and processes: number of staff, operation of Clinical Commissioning Groups, opening hours etc. There was barely any discussion of outcomes for patients.

While Labour warn of the ‘marketisation’ of the NHS and the ‘fragmentation of services’, the truth is that the UK continues to perform poorly in terms of cancer and stroke survival rates, mortality amenable to healthcare and the efficiency of the service (on proper measures of efficiency, which judge *outputs* for given inputs, not just overall money spent).

Guess what? Many Western countries that are held up as social democratic beacons have far more private and voluntary sector involvement in the provision of healthcare and have better outcomes too. Until the debate around healthcare shifts from being about its staff to us patients, is there any hope we’ll learn lessons from elsewhere?

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The Conservatives rightly celebrate the strong employment performance of the UK in recent years. But if we’re honest, this performance owes far less to their deficit reduction ambition than the inherently flexible labour markets the UK enjoys (no doubt buttressed with tightened welfare conditionality and the raising of the personal allowance). It’s after times of crisis, when firms lay off workers, that one sees the true benefit of this type of policy – where the UK is relatively liberal compared to our continental neighbours. It’s a big reason why in the UK unemployment is 5.7 per cent, versus 23 per cent in Spain.

Though I am on the record as criticising Miliband’s policy for higher government spending and more debt, I am far more worried about his desire to undermine this labour market flexibility in the name of ‘security’. Tighter conditions on zero hours contracts, banning unpaid internships, and politicisation of the Low Pay Commission to set minimum wages – all will be costly in terms of not allowing voluntary exchanges of labour to take place.

Of course, it’s politically difficult to be seen to speak ‘in favour’ of zero hours contracts or unpaid internships, given the historic expectation of secure employment. But for all the reasons to support the Conservative party that impact people’s lives, maintenance of labour market flexibility is surely right up there.

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It’s a cliché, but all political parties are coalitions. They group together and come up with a manifesto that most of the intra-party groups can get behind – offering a programme for government. I’ve always considered that one of the big disadvantages of proportional representation is that this process is much more likely to take place after the election, with many interest groups bargaining behind closed doors to develop an agenda.

In contrast, First Past the Post has in the past been perfect for strong government in a two-party, large intra party-coalition process. Now that that’s not the case – and smaller parties are coming to the fore – where do we go from here? It’s tempting for some to suggest abandoning FPTP entirely. But changing constitutional arrangements simply on the basis of current polling and voting is not sensible. Who knows? Maybe we’ll see a return to two-party dominance as the electorate observes a chaotic period after Thursday.

From a democratic perspective though, and given everyone says they want a stable government, the best way to have assured it after Thursday in a democratic way would have been for parties to be extremely clear about their red lines and who they’d negotiate with after the election. In this regard, the Lib Dems have been admirably clear. We are all almost certain that’s there going to be a hung Parliament, so why are the main two parties so unwilling to discuss what they’d do? If the Independent’s editorial today is representative of ‘thinking’ social democrats, an honest approach about being willing to work again with the Lib Dems may even have helped the Conservatives.

14 comments for: Ryan Bourne: When Clegg claimed over two in five families are vulnerable. And other thoughts on this election campaign

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