The case for cuts is won, the case for lower taxes is just beginning

November 03, 2010 6:03 PM

I've spoken at two quite interesting events recently.  Mike Denham and I spoke at a Treasury Solicitor's Department event at the Chartered Institue of Management Accountants.  A few dozen Civil Servants from across Whitehall watched us debate the motion "Cuts in Public Spending are right and necessary" against Tim Horton, the Research Director at the Fabian Society.


Just yesterday, I spoke at the Property Week Public Property Summit.  The Director of the Smith Institute, Paul Hackett, was on the panel and, while there wasn't a motion, we sparred on the big economic picture and the case for cutting spending.  I think the audience were mostly property professionals who worked with the public sector.


At the end of both events the chair took a vote from the audience.  In both cases, the TPA case for cuts won by a margin of around two to one.


Does that mean we have won and everyone now agrees with every part of our programme?  Probably not.  It is just that most people do accept the basic case that spending cuts are right and necessary.  There will be disagreements on the detail and scale of the cuts but the basic case that spending should come down is won for now.


That poses a problem for organisations like the unions that are trying to oppose cuts in principle.  Their protests at specific cuts won't sound credible to the public unless they acknowledge the broader need for cuts to be made and not oppose every cut the Government proposes.  Alan Johnson and Ed Miliband's response to the Spending Review didn't pass the test because, while they accepted the need for cuts in principle, they failed to identify any they actually supported.


Of course, there are other areas of policy where things aren't going as well.  It has become accepted wisdom that it is impossible to challenge measures like the 50p rate, even though it will reduce revenue from the rich according to independent forecasters and therefore increase the burden on ordinary taxpayers.  That's why the TPA is starting work on the long term case for tax reform, to get the kind of movement we've seen on spending.

I've spoken at two quite interesting events recently.  Mike Denham and I spoke at a Treasury Solicitor's Department event at the Chartered Institue of Management Accountants.  A few dozen Civil Servants from across Whitehall watched us debate the motion "Cuts in Public Spending are right and necessary" against Tim Horton, the Research Director at the Fabian Society.


Just yesterday, I spoke at the Property Week Public Property Summit.  The Director of the Smith Institute, Paul Hackett, was on the panel and, while there wasn't a motion, we sparred on the big economic picture and the case for cutting spending.  I think the audience were mostly property professionals who worked with the public sector.


At the end of both events the chair took a vote from the audience.  In both cases, the TPA case for cuts won by a margin of around two to one.


Does that mean we have won and everyone now agrees with every part of our programme?  Probably not.  It is just that most people do accept the basic case that spending cuts are right and necessary.  There will be disagreements on the detail and scale of the cuts but the basic case that spending should come down is won for now.


That poses a problem for organisations like the unions that are trying to oppose cuts in principle.  Their protests at specific cuts won't sound credible to the public unless they acknowledge the broader need for cuts to be made and not oppose every cut the Government proposes.  Alan Johnson and Ed Miliband's response to the Spending Review didn't pass the test because, while they accepted the need for cuts in principle, they failed to identify any they actually supported.


Of course, there are other areas of policy where things aren't going as well.  It has become accepted wisdom that it is impossible to challenge measures like the 50p rate, even though it will reduce revenue from the rich according to independent forecasters and therefore increase the burden on ordinary taxpayers.  That's why the TPA is starting work on the long term case for tax reform, to get the kind of movement we've seen on spending.

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