Published:

66 comments

Ken Clarke delights in pointing out that under Margaret Thatcher, who he served as a reforming Minister, a political cycle would turn roughly as follows.  She would win an election.  Her Government would then undertake a series of reforms, all of which would swiftly run into opposition, not least from all the interest groups concerned.

The Conservative poll ratings would plummet. Another election would eventually come.  She would then win it again…at which point the cycle would once again commence.

Last year’s Tory manifesto and yesterday’s Cabinet meeting are a reminder that it is all rather different these days.

The former was stress-tested in order to avoid a repetition of the social care calamity of 2017.  Quite right too.  But a consequence is that one can scour its pages without finding much by way of major reform.

Fifty thousand more nurses!  Twenty thousand more police!  Millions more invested in schools, science, apprenticeships and infrastucture!  A massive programme of improvements for our roads!  As for our armed forces, “we will always fund them properly”.

Over at the Treasury, Sajid Javid has helped to ensure that the Government is committed to ensuring that “public sector net investment will not average more than 3 per cent of GDP” and that “debt will be lower at the end of the Parliament”.

That means a squeeze on current spending – it is a different matter with capital – if taxes are not to rise higher than they otherwise might.  The Government has said that it “will not raise the rate of income tax, VAT or National Insurance”.

That form of wording leaves room for some jiggery-pockery with thresholds, but both Javid and Boris Johnson will want to avoid that if at all possible.  So there is a trade-off between tax hikes elsewhere and spending rise reductions.

Ministers have consequently been told to slaughter sacred cows even though the interest groups concerned will fight like protective tigers.  Some officials will “squeal”.  It is an entire animal farm.  Departments have been told to go through their spending line by line.

In his latest famous blog, Dominic Cummings has written that “there is a huge amount of low hanging fruit — trillion dollar bills lying on the street”.  If these can be found in the ways he then suggests then departmental ministers can relax.  But it may all not be quite that straightforward.

Another Dominic, Raab – now embroiled in Iran – once proposed a plan for radical savings.  He wanted to slash the number of departments from 20 to eleven.  Many of his proposals echo current ones, or vice-versa.  For example, he wanted to put the Department for International Development into…the Foreign Office.

It isn’t clear whether Johnson intends such structural reform.  And if does whether the civil service will ensure that it becomes a shuffling rather than the removing of deckchairs.  But whatever happens, there are limits to what can be squeezed out of departmental change.

One comes back in the end to reform if one wants savings – and stable let alone lower taxes.  On healthcare, the manifesto pledges to “study carefully the recommendations of the ongoing review led by NHS clinical staff into A&E and clinical performance”.

On education, provision will be expanded for those who have been excluded from school.  On social care, the Government will let you know; sorry, “build a cross-party consensus”.  That defence pledge costs money if met.  So does Universal Credit.  We don’t believe that “reaching net zero by 2050” can be done without cost.

“Tougher sentencing” means more prison place.  Oh, and “we will keep the triple lock, the winter fuel payment, the older person’s bus pass and other pensioner benefits”.  Some claim that Laffer curves can solve all these problems.  But all Conservative Governments, including Thatcher’s, have put sound money first.

In a properly-ordered political world, there would be a real fundamental spending review, looking at everything government does, and asking whether it must be done and, if so, whether civil society or the private sector can do it more effectively.

The Big Society, anyone?

But this Government is roughly a million light years away from undertaking any such thing.  Voters are sick and tired of “austerity” – whatever that may mean now.

That mass of Red Wall seats was won precisely because Johnson was able to bat off claims that he leads the “same old Tories”.  That meant no big reform plan.  All these challenges can be danced around or ducked or evaded for a while.  But not indefinitely.

66 comments for: “Trillion dollar bills lying on the street”

Leave a Reply

You must be logged in to post a comment.