Knives out for spending cuts debate
By Alex Stevenson
A report outlining how the government could slash public spending by £50 billion has prompted angry reactions from the left.
The TaxPayers’ Alliance and Institute of Directors’ (IoD) joint report outlines 32 steps to save £42.5 billion a year from 2010/11.
Brendan Barber, general secretary of the Trades Union Congress, responded by claiming the victims of the cuts envisaged would be “pensioners, children, students, the poor and parents”.
Among the initiatives the report’s authors would like scrapped are the government’s flagship school-building programme, the NHS national IT programme and the controversial identity cards scheme. These would save £2.3 billion, £1.2 billion and £55 million respectively.
The biggest single savings come from ending child benefit and the child trust fund, saving nearly £8.5 billion, and a one-year pay freeze across the public sector saving £6.2 billion.
If needed the latter could be extended indefinitely. With a further £1.2 billion gained from reducing annual pay for the richest five per cent in the public sector the £50 billion figure is reached.
“We should be grateful to the TaxPayers’ Alliance and the Institute of Directors for spelling out exactly who the victims of public expenditure cuts will be,” Mr Barber commented.
“Particularly striking is the absence of any cuts in the welfare state for the super-rich, such as tax relief on the huge pensions that top directors pay themselves.”
Childrens’ welfare charities berated the report for giving up on the vulnerable.
Kate Green chief executive of the Child Poverty Action Group said: “These policies are precisely the wrong answer to a downturn caused by unregulated casino capitalism.
“These policies would damage children and families long after the recession is likely to have ended in the UK.”
National Union of Students president Wes Streeting said proposals to abolish the educational maintenance allowance and interest subsidy to student loans contained in the report were “outrageous”.
“This report is a stark reminder that the TaxPayers’ Alliance does not represent the interests of ordinary people in the UK,” he commented.
“It is really an alliance of right-wing ideologues, who are seeking to restrict support and opportunities for honest, hard working people.”
The Taxpayers’ Alliance’s chief executive, Matthew Wilson, pointed out that public spending has to be reduced to rebalance the nation’s finances.
“Families and businesses have had to tighten their belts with the onset of the recession, so it is now time for the government to follow suit,” he said
“After years of simply spending more and assuming the taxpayer will pick up the bill, the situation has changed.”
The IoD’s director general Miles Templeman agreed, saying: “Any cut in spending naturally has the potential for some pain, but our list shows that large sums can be saved without hurting vital services.”
Responding to the report, the Local Government Association argued that councils were among the most efficient in the public sector.
Its chairman, Margaret Eaton, argued recession-hit Britain needed help from local authorities more than ever.
“Town halls are taking decisive action to protect local people and businesses from the worst effects of the recession,” she commented.
“They are helping to keep people in their own homes, offering support to the unemployed and helping small companies stay afloat.”
Town halls achieved savings of £3 billion between 2004 and 2007. Following Alistair Darling and David Cameron’s speeches that further action is needed, it seems likely they and government departments will soon be asked to make more.
The Department of Culture Media and Sport (DCMS), which would afec cuts of 25 per cent under the report, launched a strong defence of its record.
“Around 95 per cent of our budget goes directly to the 54 public bodies that we sponsor,” a spokesman told politics.co.uk.
“These organisations are at the forefront of promoting Britain as a world class tourist destination and a powerhouse of culture, creativity and sporting achievement, with a deserved international reputation for excellence.”
