Between 1992 and 1997 Labour spokesmen and women made all sorts of suggestions and proposals which would have increased public spending. Just before the election Gordon Brown as Shadow Chancellor announced that most of these were unaffordable or were not serious. He only permitted a short list of pledges to add to the fairly tight Conservative spending plans, and these were to be paid for by his new utility windfall and pensions taxes.
Today the Conservatives are doing the same. They are ensuring that all the items that go into their Manifesto as pledges are affordable. This means very little additional spending can go in, given the dreadful state of the national accounts. Labour’s dodgy dossier gets some things wrong, and costs others which were no more than aspirations in better times. Meanwhile the government’s own public spedning “promises” for future years are often just cloud cuckoo land proposals that cannot be afforded in the current climate. They are getting out the many large items they wished they had spent money on when they had the power, and putting them out there as a list for the next government to cut to get back to reality.
I was pleased to see the Conservative party is thinking again about how to find a lower cost way of recognising marriage in the tax system. The priority for tax cuts must be cuts in taxes on enterprise, cuts which will bring in more revenue. We need to increase the tax revenue from the rich, from the successful, from the company sector. The way to do that is to cut the higher rate of income tax, cut the corporation tax rate, cut the small business rate, abolish IR 35 and recreate the enterprise rate of CGT. Gordon Brown’s best policy was the 10% CGT rate for people investing in their own businesses. It is a pity he had to remove even this during his scorched earth phase.