Are the Tories lying again about spending cuts?
Labour has claimed that Conservatives will make £70 billion worth of spending cuts if re-elected in May – more than double the amount that David Cameron and George Osborne have claimed.
It is possible to dismiss this as electioneering hyperbole but, let’s face it, Cameron and Osborne don’t have a good record here; they promised to balance the books by May and instead the deficit is stubbornly sticking to £100 billion a year and they have doubled the national debt.
Labour has published analysis showing that the “unprecedented” and “extreme” scale of these spending cuts would pose a major risk to the National Health Service and/or vital public services such as policing, defence and social care.
The cuts would be so extreme that they would lead to the smallest police force since comparable records began, the smallest army since Cromwell and over a third of those older people who receive social care losing their entitlement to it.
Shadow Chancellor Ed Balls has claimed that George Osborne can only achieve his spending plans by pressing ahead with “unprecedented, extreme and close to impossible cuts”, by raising VAT yet again, or by cutting the National Health Service.
He said that, across the Organisation for Economic Co-operation and Development (OECD), there have been only seven countries since 1945 where reductions on this scale have been attempted and for which we have available health spending data. Across these examples, public spending on health care has been cut – on average by one per cent of GDP.
If the average experience of these past fiscal consolidations were to be replicated in the UK over the coming four years of the next Parliament, then this would imply a real terms cut in NHS spending of over £10 billion by 2019-20.
“This is the implication of the choice that George Osborne made last December – and which he is now trying to brush under the carpet,” said Mr Balls.
“If he is to deliver on his Autumn Statement plans for a £23 billion overall budget surplus, as he says, through a Budget with no fiscal loosening, while promising unfunded tax cuts in the next parliament, then he is going to have to deliver these colossal cuts.
“The evidence is clear – countries which reduce public spending at the pace George Osborne intends have found they have had no alternative but to cut health spending.
“And after their broken pledge not to have a top-down re-organisation of the NHS in this Parliament, the British people know that the Tories have form when it comes to broken promises on the NHS.
“If David Cameron and George Osborne cannot spell out how their sums add up… the British people can only conclude – and would be right to conclude – that alternative plans do exist: to cut NHS spending and introduce charging.
“David Cameron and George Osborne must come clean or the British people will draw their own conclusions. And then, in May, they will make their choice.”
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The Tories make no effort to hide their corruption and, as a matter of routine, they tell barefaced lies. Personally, I don’t believe a word they say.
I think, in general, politicians of all colours are behind the curve. It was always the case that a minister could say something in the house, get the desired headline and then quietly withdraw the remark a few weeks later. Scandals, even if reported, were soon forgotten and lax politicking was derigeur. Now with the advent of blogs like this and other, which will lean their own way, statements can be fact checked and punctured before they make it into print. There are various reasons why the public is generally dissatisfied with politics in general but now they have access to most of the facts and figures, manifestos and voting records. Messrs Cameron and Osborne are under the microscope as never before. But will voters pay attention? Do they know what they’re voting for? How many read a manifesto before deciding how to vote? Politics will have to reassess itself if it wants any credibility. The party to implement something to overhaul the process and perceived ‘untouchability’ of MPs will gain the respect of a nation. With the state of repair of Westminster, calls for EVEL, more power for Wales and Scotland and at least three permutations for coalitions/agreements this is a critical time for the idea of democracy in Britain..
Abso-blooming-lutely !
10 billion? Isn’t that the cost of maintaining an internal market within the NHS? Here’s an idea, why not scrap that, scrap the health and social care act (and with it the egregious nullification of the duty bestowed upon the health secretary to provide universal healthcare for all, or in other words, the entire basis of the NHS), scrap the continued use of PFI contracts, and in the process reduce the administration costs to preThatcher levels of 5% of the budget not ~14% and growing as it is now. David Cameron said he wanted the NHS to run like a business, but what business in its right mind would sacrifice a monopsony (one buyer) by fragmenting itself in order to help its competitors. Does David Cameron not understand how big businesses operate? If you’re a big supermarket buyer like Tesco you use your entire weight to put pressure on suppliers to lower prices. That doesn’t work if you split Tesco up into hundreds of independent competing businesses, but that’s exactly what the past 25 years of politicians have done. Its alright for corporations to use monopsony power for the benefit of their shareholders, but not alright for the NHS to use monopsony power for the benefit of the public it seems.
Labour is planning to scrap the Health and Social Care Act immediately on taking office (if they win the election), of course.
Your comment on administration costs is interesting – is there a reference for that figure? I could use that…
My personal reference (albeit not an official source) is from the documentary film “Sell Off”, though it’s not the first time I’ve come across the figure:
https://www.youtube.com/watch?v=ultKvnw2h3Q
I would fully recommend everyone watch this documentary. Allyson Pollock, professor of public health research and policy at Queen Mary, University of London (who appears in the film) has also done a TEDx talk on the subject:
https://www.youtube.com/watch?v=Cz5dl9fhj7o
I will be voting Labour later this year, because I live in Chukka Umuna’s constituency, and I think he is a fantastic MP and shadow business secretary. However, it is important to remember that Tony Blair became prime minister under the presumption that he would be scrapping the internal market, and instead he imbraced it with open arms when in power. There are plenty of Labour Party associates with interests in private healthcare, and on top of that, there’s the weight put on government by their own hired consultants (McKinsey, KPMG etc….) to move towards a more marketised system. Moving to a private system would allow for an influx of foreign investment from the US private healthcare system, which could result in more high wage financial and corporate services jobs, and increased economic activity, effectively generating jobs by making the system more inefficient. I suppose that’s little different from the Luddite argument. I suspect these things will weigh on MPs minds.
I disagree strongly with your claim that moving to a private system will bring investment. It hasn’t with energy, water, railways or the Royal Mail (to name just a few examples).
I think my stance is pretty clear that privatisation of healthcare is bad, and will lead to a worse healthcare system. The costs of the American system is ~30% administration. That’s a lot more administration jobs. I was attempting to understand the problem from the politicians point of view. If you don’t understand the oppositions argument, how do you know you aren’t missing something? Why did Labour speak out against Margaret Thatcher’s internal market in opposition, then embrace it in power? What is the appeal; the incentive? I don’t understand it myself, but I’d like to. I’m not convinced it comes down to just giving rich people a chance to become even richer. There’s a narrative that politicians accept (pushed by the big consulting firms, and right-wing think tanks) that lead them to favour greater marketisation of the NHS.
Correction: In my initial comment the word monopoly (1 seller) should read monopsony (1 buyer).
My apologies. You actually used a word I didn’t know.