Clearly the Conservatives felt the need for a new, more positive policy and have come up with the old Tory favourite: a tax cut. George Osborne has just spelled out a pledge to partially reverse a 1 per cent rise in national insurance due to take place in one year’s time. It is likely to be welcomed by some business groups.
The extra billions of cost will supposedly come from cuts in public spending, largely through efficiency savings. (Osborne talked about cutting property costs, reducing IT projects and not filling vacant back office posts).
But the policy places big question marks under the Tory pledge to go “further and faster” than Labour in cutting the £167bn deficit.
Most striking is Osborne’s acceptance of the £11bn of “wasteful expenditure” identified in last week’s Budget which could supposedly be cut from Whitehall departments. This included some highly dubious figures such as £550m from reducing staff sick leave from the NHS. Just like that.
The Tories are taking this £11bn figure for granted and then adding billions more of their own “savings”.
The announcement follows Saturday’s news story about how the Tories would ring-fence benefits for pensioners including the winter fuel allowance.
Anyone hoping for extra clarity over the details of just how the next government – of any colour – will cut public debt looks increasingly likely to be left disappointed.
UPDATE
Here is a link to Jean Eaglesham’s news coverage of the event.
Jim Pickard
Kiran Stacey