27 Apr 2010

IFS warns of sharpest cuts since Second World War

So there we have it. Clarity, honesty, and candour on Day 22 of the election campaign.

Not at any of the party political press conferences. No, it’s been left to the trusty holders of the spending shield of truth: the Institute for Fiscal Studies.

The top line is this: Conservative manifesto implies the largest sustained cut to departmental public spending since the Second World War.

Before Labour starts printing its attack poster … The Labour and Liberal Democrat plans merely imply the sharpest sustained cuts since the IMF humiliation in 1976.

Now try and get a politician to admit this picture of Britain in the parliament for which they seek to be elected.

On tax rises, the IFS has looked at the manifestos, and feel they imply an extra £7 billion for Labour, an extra £3 billion for Conservatives (reimposing half the effective ‘cut’ from their much vaunted jobs tax ‘cut’) and the Lib Dems are pretty much on target.

On spending, the Conservatives need to find £64 billion in cuts by 2015 from unprotected areas such as education, housing, transport etc. They have not explained 82 per cent of this, or £52 billion of cuts.

Labour need to find a £51 billion cuts from unprotected areas and have not explained 87 per cent, leaving a £44 billion shortfall.

The Liberal Democrats manifesto implies £46.5 billion of non-priority cuts, and have not explained 74 per cent of it – a £34.5 billion shortfall.

So all pretty opaque, but the IFS say the Lib Dems are the “least bad” in terms of the numbers.

More to come…

8 reader comments

  1. adrian clarke says:

    What an absolute load of cobblers.If it shows anything it shows only one party is going to attack the criminal deficit Labour has landed us with,It also shows that the Liberals are going to get nowhere near reducing that deficit on their manifesto plans.
    It also shows the need for one party government or nothing will get done .How will a coalition face up to inevitable union militancy.If you do not think it will happen , you only have to look at BA and British Rail to see that any proposed savings will be fought again

    1. Vijay L. Dandiker says:

      It would appear that only the Conservatives are willing to attack the UK Deficit. Faisal a true Journalist would not take the IFS figures to be true but would 1st investigate and ask the question how are these figures arrived at when, Labour are refusing to supply, release the information? How can you, I or anyone else (IFS) thus come to a consensus?

  2. statechaos says:

    The LibDems are only the least bad because they want to abandon Trident, and curtail the Eurofighter programme which they may find they are legally unable to do without huge and costly penalties. Moreover, any savings would take years to filter through so I expect their costings are no more plausible than those of the ‘old parties’ as Clegg likes to call them.

    1. Abdul says:

      What has the billions of pounds spent producing nuclear , biological and chemical weapons done to us -nothing rather than pushing it to third parties to misuse it .We all did it for Iraq and look what is there today . Can’t you get it that poverty and hunger are the most exigent threat man kind has today . With wars every where around the planet why have the nuclear powers not utilised thier nukes and biologicals ? all is a mere waste .The only use is to the weapon manufacturers who makes billions in a minute for producing items that none uses . All is just a gullible joke .

  3. linda says:

    Hello Faisal, I just wondered how the banks such as Lloyds TSB going into profit again would help the deficit. Would this be substantive as they start to pay back their loans and therefore alleviate the need for some of the cuts? Could you write something about this please as I feel confused. Thank you very much.

  4. not-hamish says:

    Tough on englandshire this as all the services listed, ie so-called ‘schools’, police, prisons, housing, local govt, justice’ are england-only services – the other 3-quarters of the uk operate their own separate schools, prisons etc!!! Usual deceit that what they are talking about applies to the whole uk – it doesn’t.

  5. Meg Howarth says:

    Faisal, Is it correct that a even a modest tax on land – LVT, land-value tax – could wipe clear the current budget-deficit in one year?

    Echoing Linda above (re bank profits), it would be great if you could write about LVT – surely the fairest tax there could be, and a replacement (for CT and business rate), not an additional tax. Lloyd George’s ‘people’s budget’ of 1909 included LVT. If it hadn’t been for the opposition of the landowners in the Lords, it would have been passed. It’s surely also correct that LVT would encourage people to invest their savings in productive ways rather than in non-productive bricks and mortar?

    1. adrian clarke says:

      Meg how much extra tax would that obtain and who is going to pay it .Surely if as you say it will produce more tax revenue no one in their right mind wouls want it

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