Major parties failing to spell out spending plans

8 Apr 10
The public sector was left in the dark as the opening salvos in the general election campaign failed to shed any light on where the cuts will fall.
By Lucy Phillips

8 April 2010

The public sector was left in the dark as the opening salvos in the general election campaign failed to shed any light on where the cuts will fall.

Party leaders made little mention of reducing the UK’s £167bn deficit, despite the hype around Prime Minister Gordon Brown’s April 6 announcement that the election would be held, as expected, on May 6.

And while public sector chiefs awaited next week’s publication of party manifestos, commentators warned that crucial details on public service spending were likely to be kept under wraps until a post-election Budget, which will probably be held in July.

Colin Talbot, professor of public policy and management at Manchester Business School, told Public Finance that the public sector had been left ‘guessing’. He said: ‘We all know what the broad parameters of public spending are going to be: if it’s a Tory government it’s going to be a bit worse than [Chancellor] Alistair Darling set out... It’s more or less the same ball park of cutbacks in public spending. The only main difference will be areas of protection.’ He cited the Labour ring-fencing of health and education budgets and the Conservative safeguards given to health. 

Talbot described the start of the election campaign as ‘bizarre’. He added: ‘Nobody mentioned the deficit and the need to cut back spending even though they have been banging on about it for ages. It’s clearly a vote loser.’

He said the May 6 poll would be ‘the least democratic election for ages’ because spending plans had been laid out prior to voting in past elections but the main parties remained ‘extremely coy’ on the subject.

James Hulme, head of communications at the New Local Government Network, said we were entering ‘quite uncharted territory’ as politicians failed to set out their spending plans before an election.

He warned that the local government sector was ‘in the dark’ over the ‘fundamental issues of how much money is going to be available for things like transport and housing’.

He added: ‘It’s quite odd to be going into a general election with none of the parties outlining how much services are going to be funded over the next Parliament.’

Hulme said that local government budgets were likely to be disproportionately hit by spending cuts because no political party had pledged to ring-fence the area.

This sentiment was echoed by the Association for Public Service Excellence, which is gearing up for cuts of ‘at least 15%’ in local government budgets. Chief executive Paul O’Brien told PF: ‘We hope that whoever is in power will have the sense to ensure that this is delivered through manageable service transformation rather than a financial Armageddon.’

Away from the campaign trail, public finances were at the centre of the final Commons clash between party leaders during Prime Minister’s Question Time on April 7. In a rowdy exchange, Brown said a Tory government would put the economy and public services at risk. ‘We can’t cut our way to recovery but we can cut our way to a double dip recession,’ he told MPs.

Conservative leader David Cameron used the occasion to berate Brown for his plans to raise National Insurance contributions by 1% from April next year, dubbed a ‘tax on jobs’. The Tories have pledged to scrap most of the planned increase, a move that is backed by scores of the country’s most high-profile business leaders. They instead pledged to save £6bn – the sum Labour hoped to raise through its NI increase – by reducing government waste.

Cameron said voting for Labour was a ‘decision to go on wasting money and putting up tax on everyone in the country’.

Liberal Democrats leader Nick Clegg told both his rivals that they had ‘failed’ and ‘it’s time to go’. He has touted his party as the only one that is being honest about cuts, having outlined £15bn worth of lower priority public spending.    
Unions are also stepping up their fight over pay, jobs and public services as polling day draws closer.

Mark Serwotka, general secretary of the Public and Commercial Services union, urged all parties to sign up to a series of pledges to protect public services, which ‘are under severe threat from a political consensus that says massive cuts will be necessary after the election’. The pledges included no further job losses or privatisations.

Christine Blower, general secretary of the National Union of Teachers, which is already threatening industrial action over spending cuts, added: ‘Teachers will not stand by and see their pay and pensions attacked. Their workload is already unacceptable and needs to be reduced. Whichever government comes to power needs to heed this message.’

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