Rather than give in to misguided calls to ease up on spending restraint, the Chancellor must use this week's Spending Review to stay the course on deficit reduction and stick to the pre-election projections of public spending falling to 36.3% of GDP by the end of the Parliament, says the TaxPayers' Alliance. Any slippage will represent a failure to match his words with sufficient action.
Seven months into this financial year, the government has already borrowed £54 billion, adding to the £1.5 trillion national debt. It is crucial that Mr Osborne enacts spending reductions, and re-thinks the scope of government at this early stage in the Parliament.
Getting spending under control isn't just about closing the deficit. It should also be part of a strategy to cut taxes for families across Britain, reduce debt for future generations and boost economic growth. And we would still be able to provide defence, law and order, healthcare and education - as well as universal pensions and substantial welfare for those who need it.
In April, the TPA published The Spending Plan, the most detailed and rigorous guide to reducing public spending. The Government has already implemented some of our proposals - such as scrapping the Green Deal and reducing the Benefit Cap - but there are plenty more for the Treasury to consult ahead of Wednesday's statement:
- Abolish BIS, DECC and DCMS, saving around £7.5 billion
- Abolish the pensions 'triple lock' and link the state pension to CPI, saving £6.8 billion
- Save £4.4 billion by cutting Scotland's grant to match its relative prosperity compared to Wales
- Freeze benefits for two years, then up-rate with inflation, saving nearly £2 billion
- Scrap national pay bargaining in the public sector, saving £5.8 billion
- Means test Winter Fuel Payments (£1.4 billion) and target free bus passes at those who really need them (£560 million)
The Public Sector Rich List, published by the TPA earlier this month, also demonstrates considerable scope for finding savings when it comes to public sector pay, pensions, perks and pay-offs. Action to crack down on unjustifiable remuneration deals is urgently required.
Ahead of the Spending Review, Jonathan Isaby, Chief Executive of the TaxPayers' Alliance, said:
"The Chancellor must stay the course on deficit reduction and ensure that he hits the spending projections set out before the General Election. Tricky manifesto promises and political fights over issues like tax credits mean that George Osborne should look again at protected areas of spending to root out the waste and improve efficiency, meaning better value for taxpayers. This Spending Review is an opportunity to map out a vision for a lower tax and lower spend economy that generates prosperity for all, while providing quality services and looking after the most vulnerable in our society."
3:58 PM 19, Jul 2017 Katherine Harvey
12:25 PM 19, Jul 2017 Harry Davis
12:18 PM 19, Jul 2017 Thomas Overend
4:19 PM 18, Jul 2017 Taylor Boyce