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Chris Leslie: Labour cannot afford to reverse the Coalition’s cuts

30 May 2014

Chris Leslie’s speech today is intended to show that Labour is very fiscally responsible. It’s a noble task, and one the party knows it needs to hammer away at as much as it does on the cost-of-living, otherwise voters may not see that Labour is the trustworthy solution to the problem the party is highlighting. That said, the meat of this speech is very technical, and given it was delivered to the Institute of Chartered Accountants, perhaps not quite aimed at swing voters.

Leslie is shouldering a big burden here, because the main thrust of his speech is that his party could not get elected in 2015 and promise unicorns and rainbows: it cannot reverse the Coalition’s cuts because it cannot afford to do so (neither financially nor politically). He said:

‘I’m not heading into this expecting popularity. Quite the opposite. All government departments in the next Labour Government will have to face fundamental questions as never before. We won’t be able to undo the cuts that have been felt in recent years. And I know that this will be disappointing for many people. A more limited pot of money will have to be spent on a smaller number of priorities. Lower priorities will get less.’

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The solutions Leslie suggests, though, while being very noble, are going to cost the next government more money initially before it finds long-term savings. He suggests ‘greater effort than the Work Programme can muster, ‘greater health service emphasis on preventing illness’, strengthening the minimum wage and incentivising the living wage and ‘getting more affordable homes built’. The last doesn’t take up as much government money these days, as ‘affordable’ housing takes in very little direct subsidy to be built, with finance from the private sector and higher rents, at 80 per cent of market rent rather than 50 per cent as in traditional ‘social’ housing.

All well and good for a speech about long-termism at the Treasury, but Labour does need to talk about upfront savings too, as it will need to plug the scary black hole that the IFS is always warning politicians about but that they’d prefer not to mention too much in the run-up to 2015.

P.S. Leslie is also a little bit naughty in this speech. He says ‘Ed Balls and I have concluded that a Labour Treasury will put an end to the one-year spending reviews recently introduced by George Osborne’. He suggests that these one-year reviews are now the new thing, although of course they were only introduced because of coalition dynamics for the end of this fixed-term parliament.

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Show comments
  • HookesLaw

    Why won’t he be able to ‘undo he cuts’? His govt could spend what it wants. We have a growing economy.
    The only reason he would or could not undo the cuts is because they were and are necessary following the mess labour led behind.

  • Kitty MLB

    I really find Chris Leslie a smug loathsome little weasel. Why on earth must we
    listen to their morbid threats of returning to government. I honestly shudder
    when any of those little creatures appear.

    • telemachus

      There are swifts and swallows around

  • andagain

    We won’t be able to undo the cuts that have been felt in recent years.
    And I know that this will be disappointing for many people.

    Especially the people who trusted Labour when it was denouncing all those cuts over the last four years.

    • Fergus Pickering

      If they trusted Labour they were too stupid to be allowed the vote.

  • 2trueblue

    Liebore have always been fiscally incontinent. Do we really want to put them back in again? No thanks. They left nothing of value for us last time round so why go there again? Not enough houses, roads, hospitals, fuel capacity, ……… they failed in nearly area.

    • global city

      Their policy on defence should be extracted from them as soon as possible. That may scare the horses as they will likely propose cuts in addition to the massive ones already inflicted by the Cameroons.

      • 2trueblue

        They have no policies, so do not hold your breath. they have a lot of vacuous positions that they tell us they will adhere to. Slippery as usual.

        • global city

          That is just the same as the labour party, the Conservatives and Lib Dems…. unless you can point us to the manifestos today?

          Remember Miliband’s ‘blank piece of paper’? that’s the same. It is a rather embarrassing narrative to pursue as most people understand who, when and why political parties produce manifestos.Tory party, which you will have to content yourselves to criticising the actual content, rather than the fantasy policies the Liblabcon keep on referring to.

          What happened to the Tories manifesto pledges from 2010… how many are still extant?

      • HookesLaw

        Defence was 33.8 billion in 2011/12 it will be 33.5 billion in 2014/15.
        This is a cut and a bigger one in real terms but it is not ‘massive’. Army numbers including reserves are going up.
        The govt inherited a defence budget in a total financial mess from labour. We are currently building two massive aircraft carriers inherited from labour work on replacing trident has already started and have a fully funded 160 billion equipment procurement programme.

        • global city

          I meant the Labour party, though I have as little faith in the Conservatives to maintain our military forces.

  • Frank

    Just how much has government expenditure been cut? My recollection is that various people have said that 250,000 civil servants have gone (indeed the MOD is supposed to have lost 30,000 civil servants and circa 30,000 military staff), so has the actual cost of government been savagely reduced?
    Pity the article couldn’t come up with these numbers!

    • Andy

      Sod all is the answer you seek. At the end of this Parliament spending will be, in cash terms, higher than at the start of the Parliament. Some cuts.

      • HookesLaw

        According to ukgovernmentspending dot co …. Spending in 2010 was 673 billion and in 2013 it was 675 billion.
        The govt have been cutting spending and also keeping the economy and society afloat.

        • Andy

          Spending in 2010 was £672.3 billion.
          Spending in 2011 was £693.5 billion.
          Spending in 2012 was £694.3 billion.
          Spending in 2013 was £675.1 billion
          Spending in 2014 is projected to be £718.7 billion
          And spending in 2015 is projected to be 728.7 billion.

          The Government will not, in cash terms, have cut the budget it inherited. All it has done is slow the growth of spending. The economy would fair much better if the State consumed a smaller proportion of GDP, but this will not match your vision.

          So my original point remains entirely correct.

    • HookesLaw

      The OBR say that public sector job losses will hit 710,000 by 2017… under the Tories that is. Beyond that its heading for over a million. 270,000 lost their jobs in 2011 alone.
      Will that happen if we let labour back in? Check out the Guardian and see it wringing it’s hands.
      This scale of losses caused riots and strikes in Greece. Here under Osborne we have more jobs than ever and 9 out of 10 new jobs going to locals.
      Given this scale of public sector job loss its absurd to say there are no cuts. The govt are managing it well.

  • El_Sid

    Bit OT, but this is worth a read :

    Our regulator had become chief market abuser — all in the pursuit of PR.

    On the political front, we’ve now come full circle, with Osborne earlier this month announcing a fresh review of the FCA to ensure the regulator is striking the “appropriate balance of fairness, transparency, speed and efficiency”.

    But the damage has already been done….a psychotic regulator, with a frenetic
    desire for positive press

  • Hello

    I have tremendous faith that once Miliband turns up on TV, solemn face, concerned eyes, head slightly cocked back in an I-share-your-problems-the-Bolly-was-all-gone sort of way, and opens his mouth, all the vestiges of credibility that the Labour party has been diligently attempting to project will disappear.

    In the meantime though, I presume all this means that Miliband is now leading from behind?

    • Andy

      One suspects so. Instead of Bolly he could have a cup of Hemlock.

    • global city

      the remnants of that bacon butty still visable.

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