The Coalition, the cuts and the costs
Tom Jackson says it is time to face reality
It is just nine months since the coalition government assumed power. Even before the election, it was well known that the country’s finances were in a parlous state. The new government inherited a desperate financial situation, with a budget deficit of £150 billion and a national debt of over £1,000 billion, costing some £40 billion in annual interest. It was a truly appalling situation.
Since the beginning of the millennium year, in 2000, government budgeted spending of £340 billion had increased, ten years later, to £750 billion – a one hundred and twenty per cent increase! The recession and decline in economic activity, beside the growing debt, meant that continued spending on the scale of the past was unsustainable. To have an unaffordable lifestyle based on borrowing by a country, as well as by individuals, was a luxury.
Over the past weeks the Friend has published several articles concerned with the cuts in funding to many organisations. While I understand that many will be affected, I believe that it is necessary to understand the problems first. It is like a hospital consultant faced with a patient who has a problem. He or she must, initially, decide what is wrong before taking appropriate action. I am not claiming that all of the decisions that the coalition has made are sound; but at least the deep problems have been faced. So many appear to deny that such action is necessary. Despite the actions taken to reduce spending, it is noteworthy that the coalition has agreed to protect spending on the National Health Service and on overseas aid. Imran Hussain (the Friend 29 October) states that there is another way to deal with the deficit – a mix of higher taxes for the wealthy, the closure of tax loopholes and an investment in enforcing the law against tax evasion; but his solution just does not address the extent of the problem.
The previous government’s policies on housing benefit contributed to a housing boom: spending on rented accommodation, for example, increased from £10 billion to £20 billion. Over £30 billion was committed on defence procurement – without adequate financial resources being available. Action to correct such lavish spending was essential.
Anyone with a knowledge of local government will be only too well aware of the opportunities for savings. The salaries of senior staff, for example, have rocketed in recent years.
Martin Quick (the Friend 7 January) expresses concern for those affected by the cuts and urges Friends to take action. Many will feel the pain. Sadly, it will be those at the poor end of the spectrum who will be most affected. But before Friends can be involved it is important to appreciate the problems that have to be faced – before moving towards solutions.
Personally, I have for some time now regarded our way of life as unaffordable, unsustainable and unrealistic. I am, no doubt, in a minority. As someone born before 1939 and brought up in a single parent family, perhaps I see things from a different perspective. There was no welfare state during my childhood. We had to survive through our own endeavours. Mother had a small income from work. Perhaps the pendulum has swung too far in the direction of getting rather than giving. A crisis, though, can be an opportunity for a change in direction, both personally and for a country.
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