21 May 2010

Would this be Alistair Darling’s advice to George Osborne?

Former chief secretary Liam Byrne’s brief note to his successor achieved a great deal of notoriety last week – but how much better would it have been if Alistair Darling’s parting thoughts to George Osborne had also been leaked. Faisal Islam imagines how that letter could have looked:

Dear Boy Chancellor,

We never got on. You kept on getting leaks of our tax plans from Tory-friendly Treasury staffers. That was a low blow. And then you tried that very clever rhetorical outflanking of the Labour party on bashing the bankers. Laughable!

My abiding regret of the election campaign is not going for your jugular during the Chancellor’s debate, as Campbell suggested.

Nevermind, if you can fend off Cable, and Clarke, you’ll be reading this in Number 11 with the painting of Viscount Goschen gazing down on you.

I’ve left you a present (apart from the signed copy of Courage by G. Brown). You know, and I know that the public finances are a mess because our tax base collapsed during the financial crisis. I know that you will blame me for everything, despite the fact that your published spending and tax plans were minimally different from ours in the half decade before the crisis.

The present is carefully gift-wrapped. Do you know how your definition of the difference between prudence and profligacy is a £6bn reduction in the deficit? Well, guess what, you can have £7.5bn for free.

The Treasury officials who you have so comically accused of routinely underestimating the deficit, totally kitchen-sinked their projections in Budget ’09. So the deficit won’t be £180bn, but closer to £150bn. By the time you get your feet under the desk you will see that the deficit of 09/10 announced by me at £163.4bn will now be £156bn. That’s still a peacetime record, yes, but in any attempt to shrink the deficit, a bit of autonomous self-shrinking always helps.

Actually, I can let you into a secret. If by some miracle we had remained in office, we were always going to prune a couple of quangos as a ritual sacrifice to the Moody gods of Pimco.

But I was very struck by that telegenic lad from Sheffield Mr Clegg: ”It’s like cutting back a tree – do it at the wrong time of year, and you will kill the tree. Do it at the right time, and you help it to grow strong’. Or at least that’s what he thought in March.

It strikes me that these public finance numbers may present a problem. They show that a bit of growth and a spot of extra tax on the rich, can begin to work to close the deficit.

Gordon and I weren’t so off the money. Obviously massive cuts will be needed eventually, and I always planned them. But just how much do you want to actually cut right now, as opposed to preannounce for the rest of the Parliament? I hear your Coalition partners want to re-spend some of that £6bn cuts on jobs schemes. Perhaps you wanna make that £1 – 2bn rather than £100m? You have to decide this weekend, right? Heaven forbid if those cuts come and then Britain is dragged by the Eurozone back into recession. I mean it would be unfair to blame you lot for causing a double dip, but then even the new politics can be unfair.

Best of luck with the coalition,