Don't let it be lazily said that Labour and the Conservatives are 'the same'
The next time someone (particularly someone on the left) tells you that Labour and the Conservatives are the same, point them to today’s Institute of Fiscal Studies (IFS) assessment of the parties’ spending plans for the next parliament.
We’ll start with the Conservatives.
Conservative plans for a reduction in borrowing in the next parliament require ‘some large spending cuts or tax increases’, as the IFS puts it. It adds:
Departments outside the NHS, education and aid look to be facing cuts of 17.9 per cent between 2014–15 and 2018–19. This would imply average cuts to these spending areas of one third in real terms from the start of austerity (in 2010-11) up to 2018-19. These ‘unprotected’ areas include defence, transport, law and order and social care.
As for Labour, according to the IFS:
[Labour] have pledged to ‘get a surplus on the current budget’ without specifying either exactly when or how much of a surplus. This pledge could be consistent with any reduction in borrowing totalling 3.6 per cent of national income or more (given the coalition government’s investment plans). A reduction in borrowing of 3.6 per cent of national income would require little in the way of spending cuts or tax increases after this year.
In terms of the measures required by Labour to bring about their plans, the IFS says that:
If [Labour] can find £7.5 billion of revenues from anti-avoidance measures, as they say they can, then they might need to find a mere £1 billion from further real cuts to unprotected departmental spending.
So there is a choice and it is between ‘cuts of 17.9 per cent between 2014–15 and 2018–19‘ and ‘little in the way of spending cuts or tax increases after this year“.
Don’t let it be lazily said that Labour and the Conservatives are ‘the same’.
James Bloodworth is the editor of Left Foot Forward. Follow him on Twitter
35 Responses to “There are big differences between Labour and Conservative spending plans. The IFS just proved it”
Gareth Hunt
Look at our record? I’m talking about the IFS? This is not party politics but a chance to engage with the voters with fact.
Robert Gruder
Well, you can try to deny the reality of the improved economic conditions all you want but the numbers don’t lie – so you’re just being dogmatic. And yes, the recession was world wide but Britain made the best and earliest recovery under the Tories. The lack of regulation of banking in the UK was directly the policy of Balls and Brown. The lack of financial reserves was due to flagrant overspending by Brown – he got us into the terrible deficit. The only left of centre party with financial credibility is the Liberal Party. Labour is a joke, and isn’t to be believed!
Disgusted of Totter's Lane
Not all HB is excluded from the cap, but HB associated with JSA claims is.
I’m not setting out to make excuses for right-wing neoliberal austerity pushers any more than you’re setting out to defend a New Labour sticking-plaster approach to structural problems of low pay, high rents etc. It all depends how cynical you want to be. *Maybe* Labour’s support for an overall welfare cap, on the basis that we should be tackling the structural problems behind rising welfare spending, is a smokescreen for a commitment to slashing benefits. *Maybe* your opposition to an overall welfare cap, on the basis that it will harm the poor, is a smokescreen for a Blairite reluctance to tackle structural problems in a way that goes against the interests of exploitative employers, landlords etc. Or just maybe you’re actually on the same side here, trying to strike a balance between helping the poor through adequate welfare spending and helping them by addressing the problems driving that spending, and happen to disagree on the best way to do it in the political and economic context we find ourselves in.
Based on everything I read about Miliband’s political philosophy, I see no reason to be cynical about his pushing a ‘predistribution’ approach to tackling problems of poverty and inequality – i.e. pursue higher wages rather than more tax credits, lower rents rather than more Housing Benefit, etc. He might be wrong about what’s possible, he might be underestimating what’s necessary, but if the whole thing’s a front and he’s actually just a “right-wing neoliberal austerity pusher”, he’s been doing a good job of maintaining that front in public and in private over many years. (If anything, the IFS analysis suggests it’s Labour’s avowed commitment to more cuts after 2016 that’s just a front!)
Nick Smegg
There is a money tree. Instead of borrowing from the bond markets, the next government could finance a proportion of public expenditure by using the inherent credit creation power of the Bank of England.
This has been sued since 2009 to give money to the commercial banks, supposedly to repair their balance sheets and pass on to the wider economy, but in fact used for speculation. Ever wondered why the stock market keep going up? It’s nothing to do with economic fundamentals of the economy.
Quantitative Easing for jobs!
Leon Wolfeson
And that’s a small fraction of HB.
There’s no “maybe”. It IS designed, 100%, to slash benefits when they’re most needed.
I’ve – in fact – repeatedly called for a basic income. I completely oppose your “balanced” call which is based of thinking of the poor as being the people in the first place”
Miliband is *just* a standard neoliberal austerity-pusher. He’s routinely signing onto more punishments for the poor – there’s no “front” at all.