By Vivienne Russell
18 August 2010
The coalition needs to be more restrictive with health and welfare spending if it is serious about paying down the deficit and reforming public services, a Right-wing think-tank is warning.
In a report published to coincide with the coalition’s first 100 days in office today, Reform say the big spending commitments for the NHS and benefits system undermine ministers’ wish to shrink the size of the state and decentralise service provision.
The ‘emergency' JuneBudget is criticised for failing to address the billions of pounds spent on ‘middle-class welfare’ through universal child benefit, winter fuel payments, free bus passes and free TV licenses.
The report also criticised Cabinet Office minister Francis Maude’s handling of civil service reform. Rather than taking a central grip of civil service headcount and procurement, Maude should make civil servants personally accountable for performance, Reform says.
But the think-tank praises the government’s school and police reforms, which it believes will give local people more power.
Patrick Nolan, Reform’s chief economist, said: ‘The first 100 days do matter in establishing a government’s long-term vision. Its goal of a smaller government and stronger society is right but many of its policies go in exactly the other direction.
‘Governments need to take the tough decisions straight away when their political capital is at its highest. That means looking again at the big spending areas of health and welfare.’
Trade unions also used the occasion of the government’s first 100 days to get out their message about the impact of spending cuts.
The TradesUnion Congress published a list of cuts it maintains are unfair, including restricting free school meals, capping housing benefit and reducing the national school building programme.
TUC general secretary Brendan Barber said the coalition’s pledges to protect the vulnerable had not lasted 100 days.
‘What makes this worse is that these cuts are doing the opposite of what the
government intends. Far from securing the economic recovery, they are slamming
on the economic brakes. Growth will be well below potential and there is
growing risk of a double-dip recession,’ he said.
‘We can only conclude that at least parts of the coalition are using the
deficit as an excuse to secure the cuts in public services that they know that
voters would have overwhelmingly rejected if faced with a manifesto that
promised slash and burn.’
In a speech in London yesterday ChancellorGeorge Osborne said the government was determined to tackle ‘soaring welfare bills’ and the refocus public spending on ways that would foster long-term economic success.
Looking forward to the October Spending Review, Osborne said: ‘We will scrutinise every line of government spending, to identify those that will do most to promote sustainable prosperity, and which should therefore be protected, and those other areas where spending is less productive, and where savings can be safely be made.’
