The Great Tax Debate: Clegg v Cameron?

Like most people I spoke to after Spring Conference I was very impressed by Nick’s speech. I absolutely, 100%, agreed with everything – well almost everything – he said! I even whole heartedly agreed with his promise that if we had money to spare we would give it back to those most in need of tax cuts. Where he lost me a little was over the notion that we could realistically be in a position to maintain public services in the current fiscal climate and be swimming in an excess that gave us such scope for tax cuts. Even Cameron (God bless ‘im) has acknowledged that the party of tax cuts can’t promise any such thing in the next parliament.

Having sat on FPC for a couple of years now, I know only too well the plaintiff cry when new spending is proposed (for example in investing in youth services which is my particular interest) that there is no money available. Nick has promised to find £2.5 billion for the pupil premium, even before we can realistically look at tax cuts. And then there are the other issues we, as liberals must surely see as priorities. The scandal of mixed sex wards, particularly horrendous when it comes to mental health units, the overcrowded prisons and the lack of investment in tackling the drug addiction and poor literacy that leads to the revolving door for most offenders, poor housing, child poverty… need I go on?

I do get frustrated when those of us who argue that we have a responsibility to invest in improving the life chances and quality of life for all our citizens, get tarred as “tax and spend” fruitcakes. Actually, I always want to ask, what on earth is the point of taxing if it isn’t to spend? We need a grown up debate in this country about what sort of society we want to live in. We can have a society with those who can afford to get access to the best services (both public and private) and those who can’t and continue to be pushed to the bottom of the pile. Someone has to be brave enough to say that if we want a world class integrated transport system, excellent education for all our children, an NHS that is yet again the envy of the world, less crime on our streets and a better quality of life for all (including those living in gated communities for fear of being contaminated by the outside world), then it costs.

Put simply, to tax or not to tax, that is the question; whether it is nobler in the mind to suffer the slings and arrows of outrageous Post Office closures, potholes and sprouting trees, or to take arms against the continuing cuts to our public services, and by opposing end them. I long for the time when politicians stop pretending we can get all this for for next to nothing.

But, I do agree that there are places where savings can clearly be made, scrapping ID cards, abandoning PFI, abolishing unaccountable quangos, reducing the reliance on highly paid consultants, reducing red tape and nanny state targets: but would that release enough for the pupil premium and tax cuts? So, in order to be helpful, here are some suggestions for Nick, which I think may release a fair bit of dosh, though, I confess, may need an updating of party policy:

  • Scrap Trident Savings – £26 billion
  • Pull out of Iraq/Afghanistan Savings – £8 billion
  • Of course he could also have a word with the Bank of England, they seem able to come up with the odd £5-55 billion at the drop of a hat!

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    5 Comments

    • ‘Tax and spend’?? Isn’t that just shorthand for financial profligacy and waste?

      How about allocations within the budget to reduce the waste resulting from an excessive and growing public debt burden (let’s not forget PFI and PPP), thus making government more affordable?

      Instead of confusing budget calculations by continuous favourable manipulations of the ‘economic cycle’, how about actually having a balanced budget once or twice? Then there’d be at least some room to manoeuver and make a difference to taxation levels and spending priorities when and where they are needed, especially now in such a gloomy economic environment.

      While Northern Rock may end up costing us £50bn or more, the related liquidity crisis that resulted from unrestrained spending against predictions of the economic cycle could easily double that figure.

      It’s completely true that we should challenge the accepted truths that have become dogma under Brown, which Cameron and Osbourne are both too lily-livered to do.

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