14 June 2010
Deputy Prime Minister Nick Clegg has argued that cuts to benefits and public sector pay and pensions are the most progressive option available to the government.
In a speech this afternoon at the Institute for Government in Westminster, Clegg denied that his commitment to cut spending was rooted in an ideological desire to roll back the state.
Instead, the Liberal Democrat leader said urgent cuts were the only way to avoid the ‘inter-generational theft’ brought about by long-term debt.
‘To do anything else would not only be irresponsible, it would be a betrayal of our progressive values,’ he said. ‘Because there is nothing progressive about denial, and there is nothing progressive about condemning our children and grandchildren to decades of debt, high interest rates and fewer jobs.
‘How will we pursue social justice when billions of pounds of taxpayers’ money is disappearing down a black hole every year just to pay the interest on Labour’s debt while our schools and hospitals fall apart?’
Clegg focused on reforming benefits to get more people into work and reducing spending on public sector pay and pensions. But not once did he mention any possibility of cuts to services.
The deputy PM singled out ‘unreformed, gold-plated, unfunded public sector pension pots’ as unaffordable and unfair on many taxpayers.
Pointing out that the government’s pension bill is set to increase from £4bn to £9bn by 2015, he said: ‘As we face up to living within our means, we cannot ignore an area of spending that’s set to double in the next five years.’
He also repeated the government’s commitment to a levy on banks, and to trimming wasteful spending on consultants, who currently cost the taxpayer £1.5bn a year.
Answering criticisms that the LibDems have changed their mind over the need to cut public spending urgently, having previously argued that deep early cuts could harm the economic recovery, Clegg cited the turmoil in Greece over recent weeks.
‘The attitude of the markets has changed,’ he said. ‘Markets have stopped believing that all European governments can service their debts. They’ve started to charge much higher interest rates to those whose plans they distrust.’
