Anthony Painter

UK growth is anemic. The public finances are weak and susceptible to further economic weakness. Negative impact on employment of recession has been more limited in this recession that in previous recessions. Demand in the European economy is weak and likely to get weaker- a matter of grave concern to the President of the USA. A collective risk is being taken by the EU economies and the biggest risk taker of all is the UK. European sovereign debt markets are uncertain though that has yet to hit the UK.

This is the context. But from Labour’s perspective, to simply oppose each and every cut is not credible. Not least this is the case because Labour committed to £39billion of (mainly unidentified) cuts before the election.

And so as we look at the Conservative Government’s emergency budget what should be the way of defining whether a cut is a ‘good’ or ‘bad’ cut (or tax increase)? Here are a list of possible benchmarks (and many of them are interrelated):

1. Does the cut harm the short or long term prospects for economic growth?

2. Does it have a significant impact on employment?

3. Does the cut hinder the UK’s transition to a low carbon economy and ability to meet its energy needs?

4. Does the cut increase child poverty on the traditional 60% of median earnings measure?

5. Does it hit the least well-off disproportionately? (i.e. does it increase inequality?)

6. Does it make people less healthy, reduce dignity in retirement or help for the disabled?

7. Does it harm educational prospects?

8. Do the cuts harm the ability of the UK to meet its foreign policy and international development commitments?

9. Is the burden of cuts overall disproportionately borne by particular regions?

10. Does the cut impact upon community safety?

There. I should emphasise that the focus of the above is on impacts and outcomes not on inputs. For example, the fact that ‘community safety’ is specified does not mean that there should be no cuts from the Home Office or Department of Justice budgets. It is just that such tests much pass a ‘community safety’ test. ID cards were an easy cut in this regard.

If cuts are starting to impact on these critical outcomes then tax rises will have to be revisited (at the right time given requirement 1) but those rises will have to pass test 5- that they do not increase inequality. It seems to me that these tests provide- given a degree of objectivity and realism- Labour with a basis on which to critique the Emergency Budget and Autumn Spending Review.

Finally, the Government was at pains to emphasise that the task is monumental and we are all in this together. And yet, it has just carried on regardless making decisions on our behalf. Could this Budget not have been a ‘Green Budget’ instead of an ‘Emergency Budget’? They could have outlined two or three different scenarios for cuts v tax increases given their overarching (and very risky) economic policy. There could then have been public discussion about these enormous decisions. Instead, as always they are just plowing ahead regardless. It’s amazing how often the ‘new politics’ looks just like the ‘old politics’ but with a few blokes wearing yellow ties hanging around.