Reallocation to save the public sector

Fierce reminders on the telly last night and this morning are reminding us of the fire burning mass strikes that took place in protest at Tory cuts, and my goodness back then they didn’t mix their words, its a price worth paying – who’s paying?

Trade Union leaders at TUC have warned that this could be the reality again, wildcat strikes, already a feature of the year gone by.

There may have been a secret let out the bag that the Tories, under George Osborne’s jurisdiction, want to cut spending by 30%, but on the Labour side discussions are under way about where best to cut from, if the budget is going to be slashed.

Many of the Labour commentators are calling for cut in the middle class purses, not so much out of an able-to-pay philosophy, as such, but in order to keep afloat the working and lower middle who might not have been able to prepare for such an event.

It seems pretty reasonable, but then this propsal, featuring in yesterdays Observer also seems like a modest one, in these times;

Slash bankers’ bonuses, build more affordable homes, enshrine equal rights for agency workers and support better childcare provision. And while you’re at it, stop top earners getting tax relief on pensions, axe the £16bn Trident missile programme, scrap ID cards and use the money to rebuild Britain’s manufacturing base and protect key public services and jobs from cuts.

Gordon Brown will try desparately to stop unions from mass striking, saying that it is realistic that cuts will be made – for the greater good?

The basic premise of the above proposal is to say lets take from extravagent spending – set about at a less spendthrifty time – and not draw anything away from the public sector, who at once have done nothing to deserve it, but will bear the most burden.

If there was anything to be said for a high pay commission, it is to fund a sector that is constantly made vulnerable by private sector mistakes – i.e. there should be no unreal bonus pay after a fiscal stimulus – inappropriate it may be, but furthermore, it’s a slap in the face for those to where the money has been reallocated.

Indeed the reallocation of funds for antiquated plans such as Trident, unnecessary items as ID cards – which can be shelved at least – and caps on unrealistic earnings – not just in a recession, but at any time – will safegaurd the public sector from sinking.

George Osborne, recently in an interview with John Harris, said that under his watch, the banks won’t mind tougher regulation if it means wider change, if that were true, then the banks won’t mind if that change goes ahead by people who mean it, and that doesn’t mean scrapping the FSA – a city regulatory system – but strengthening it.

Balls is right (I admit now), Labour in-fighting gives Tories political highground

Alistair Darling, one half of the duo who quashed city analysts’ predictions on the longevity of financial recession, has clashed with Ed Balls over spending in the health and education departments.

Fair?

Those independent economists (bless them) referenced in the Telegraph article today have said that whoever wins next election will have to squeeze public spending in order to pay back the 700bn borrowing prgramme.

But on CiF and during an interview with Radio 4’s World at One Balls spelt out his reasons for wanting to go ahead with spending, along with why fighting within the Labour ranks is hurting the party, and giving the Tories a free ticket to political highground.

But Balls in the interview was clearly more cautious than some have now made out – like Liam Byrne for example, who said;

“We are going to decide how the growth in public spending is divided up much closer to the time. Looking into a crystal ball and understanding what the economy looks like in the year of the Olympics, I just don’t think is possible right now.”

Balls boldly stated that the moves on spending, to outdo Tory plans on 10% spending cuts;

“will depend upon what happens to the economy and to unemployment and debt interest. But I think that with tough choices we can see real rises in the schools budget and the NHS budget in future years.”

These careful claims are justified, but why have they not been backed by the Chancellor’s department?

Does Darling not believe his own part in the claim – now with Paul Krugman agreeing that Labour are the right party to fix the economy, and Jose Manuel Barroso limiting his focus on America, which by his predictions has not seen the worst of the recession yet – that the UK has the best chance of a quick economic recovery in europe?

Or is it something a little deeper; does it have anything to do with the fact that, as shadow schools secretary Michael Gove questioned, Balls is the man Gordon Brown wanted to make chancellor, [and] Alistair Darling [is] the man he was too weak to move?”

Certainly with TUC’s predictions recently that job losses will continue, now in the public sector – previously resisting the pressure by economic downturn – public spending should be bracketed as important as debt relief – since that debt has been largely public sector relief, its time to focus on how to avoid public sector collapse and more economic misery for working families.

And on a more strategic level, cuts in the public sector is where the Tories are at their most vulnerable; George Osborne and Kenneth Clarke have both said that cuts are inevitable, and Andrew Lansley, the shadow health secretary, has said that to commit to Balls’ needs would mean cutting other departments’ budgets by 10 per cent (earning his pseudonym Mr. 10% by Liam Byrne).

The party must stay focused, cut out the deadweight and the weak, work out how to marry financial repair and public spending to curb job losses and economic misery for working families, and show the Tories that cuts will not cut it with the country’s economy.

Follow

Get every new post delivered to your Inbox.