Ed Balls has a new take on having your cake and eating it

There are two problems with a Liberal Democrat like myself blogging about Labour Party conference. First, as I’ve so often seen from the other side of the fence, an outside blogging about another party’s conference frequently misreads what is really happening. And second, no blogger can compete with Hopi Sen and his cat.

So caveats deployed and on to the confusion that Ed Balls’s speech today left me in. For he had two messages: first, that Labour can’t promise to undo the government’s cuts and, second, that many of the cuts are wrong. Either on its own would be a workable political message, but to combine saying “no matter how much we dislike particular Tory spending cuts or tax rises, we cannot make promises now to reverse them” with then giving a long list of criticism of cuts is not only to want to have your cake and eat it but to pretend there are no calories involved in cake eating.

As leaders and shadow chancellors of all parties have found in the past, trying to gain financial credibility by reigning back on spending promises is hard. No scratch that, it’s very hard. But a shadow chancellor should at least manage to keep on message in their own speech.

The other curio of Labour conference so far is the choice of policies to abandon. Now, if you’ve just been hammered in a general election, then the sensible response is indeed to think about what policies might need changing or consigning to history. So in itself Labour dropping previous policies is sensible and what anyone else would do in their shoes.

But… the two policies we’ve had dropped in the last couple of days aren’t simply policies from the 2010 general election manifesto but rather policies Labour has been pushing since May 2010. Remember the talk about mutualising the nationalised banks? All gone, with Ed Balls’s promise to sell the nationalised banks and use the money to pay off the national debt. Remember too Ed Miliband’s attack on the government’s tuition fee plans, saying that only an increase of a few hundred pounds was needed? All gone too, with the new policy of backing a doubling of fees.

Not only that, but bizarrely Labour’s chosen tuition fees policy is one which – as Centre Forum pointed out today – doesn’t exactly help the obvious people:

Since no student has to pay upfront under either system, the proposal makes no student better off or worse off while they are studying.

Over half of the gain to former students goes to the richest 20% of graduates: those with lifetime earnings of over £2m in today’s money.

The winners are also disproportionately old. Less than 1% of graduates will gain from this proposal within 10 years of graduation. The typical winner will have graduated 28 years earlier, and will earn £72,500 at the point at which they benefit from this proposal.

In addition, there is a significant gain to students with well-off parents who pay their fees upfront, rather than borrowing from the government. European students also benefit, as they must make repayments under the loan system but would not be liable for a UK tax.

The proposal is clearly regressive.


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  • Spot on Mark:

    “Labour can’t promise to undo the government’s cuts and…[also argue] that many of the cuts are wrong.”

    The same applies to the tuition fee cap – neatly dissected by Tim Leunig in his LD Voice piece and CentreForum analysis.

    I’m not sure about the title of your piece though.

    Labour – watch my lips Balls – simply appears muddled and confused. It is plain daft to tell anyone who will listen – and Hopi Sen clearly finds it difficult – that you want something that you have no confidence you or anyone else can deliver. It is also a kind of madness to announce – having condemned Coalition policy on student fees – that you want a cap of £6,000, so you don’t really have a principled disagreement with what the Coalition has done and then go on to add that the suggested cap (for the time being) shouldn’t be taken that as a Labour policy commitment.

    The cake is snatched away before you can even begin to contemplate eating it; new New Labour policy is rather like Lewis Carroll’s Cheshire Cat. No so much a cake – you might like to eat – as a smile that vanishes in moments.

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