The Independent today tells its readers that the public sector austerity is big and long lasting, without precedent in the UK. They do, however, acknowledge that my claim is true that for the first two years of the Coalition overall current public spending has been rising in real terms. That is progress.
They suggest I am being unfair in my presentation. They point out that capital spending has been cut. I have never denied that. They should remember however, that it was cut by the outgoing Labour government. They should call them the Darling cuts, not the Osborne cuts as they do. The incoming Coalition government abated the capital cuts a little as they thought them too severe. Total public spending carries on rising in cash terms despite them.
They then point out that from next financial year there will be real cuts in current spending. Again, I have never denied that the government believes that. Cash spending goes up, but the government thinks costs will also rise more. The largest real cut is scheduled to take place in 2014-15, election year. Time will tell if these plans are fully implemented. I am glad to have the Independent’s confirmation that so far there have been very few cuts outside the capital spending area, that the cuts are mainly all to come, and so far deficit reduction has relied on higher taxes.
It also remains the fact that as cash spending will continue to rise there will only be real cuts if we experience too much public sector inflation. There are choices to be made on that by managers and employees over pay and by suppliers and buyers over prices.