Steve Richards: The hidden debate that lurks behind all this talk of trust, terrorism and the environment

Across the land the cry goes up that more money is needed as troops struggle and passengers fume
Click to follow
The Independent Online

Consider the future agenda that political leaders prefer to highlight. With varying degrees of emphasis they proclaim their readiness to meet the challenges posed by the environment, terrorism and the need to restore trust in politics through new constitutional reforms. Greenery, terror and trust are themes that whirl around British politics on a daily basis.

All are important and worthy of intense debate. They are also conveniently imprecise in their financial implications, safely removed from the hidden policy area that overwhelms all others: the level of public spending and how we pay for it.

Ultimately, tackling climate change will cost. But so far it is impossible to assess how much we will pay and in what form. The proposals for green taxes outlined in detail by the Liberal Democrats, and more vaguely by the Conservatives, are comfortingly countered by promises of tax cuts elsewhere. More widely, the green debate moves quickly onto grand schemes involving the rest of Europe, India and China. Grand schemes tend to be politically safe.

The threat posed by terrorism is already costing money, but to some extent the amount is swallowed up in the vast Home Office budget. The political debate becomes more philosophical about what it is to be a liberal when terrorists plan to strike. The debate matters greatly, but will not decide how votes are cast at the next election.

The third big popular theme, constitutional reform, costs nothing at all. Constitutional reform tends to become popular with political leaders when they are wary of talking about spending issues. Remember, New Labour in the build-up to 1997 and look at Gordon Brown as he prepares for Downing Street now.

In contrast to these important but politically safe issues consider some of the stories dominating yesterday's newspapers. Several newspapers reported that defence spending was the lowest since the 1930s, arguing that cuts threatened the Navy's warship building programme and were leading to an unprecedented level of disaffection among senior officers. The Conservatives' defence spokesman, Liam Fox, sought assurances that the cuts would not be implemented in the Commons yesterday afternoon.

Elsewhere, commuters in Bath were protesting against the expensive and hopelessly poor train services by refusing to pay their fares. As usual, there was a familiar smattering of reports about hospital closures and the protests that are accompanying them.

In relation to each of these stories there is always a minister or government spokesman on hand to put the other point of view. A spokesman points out that the defence budget has been increasing in real terms. A transport minister argues that investment in trains is at an unprecedented high. The health department makes the same point in relation to hospitals.

In doing so they point towards the great hidden story of the coming years. The ministers and spokespeople are right. Spending is at an all-time high. The level of investment has soared in recent years. Yet still it is not enough. The justified screams are heard for better-equipped armies, trains that compare with those in the rest of Europe and hospitals that respond more effectively to their communities. Across the land the cry goes up that more money is needed as troops struggle, travellers fume and patients wonder quite what is happening to their hospitals.

Political leaders are less keen to stride on to this terrain for a starkly simple reason. There will be a slowdown in the growth of public spending from more than 5 per cent in real terms in the middle of the decade to 2 per cent or less. The demand for more comes at a time when there will be substantially less. This is the hidden story, but it will not stay hidden for much longer.

Partly, the squeeze in public spending will provoke a more intense debate about the way the cash was spent in the years of plenty. Inevitably this will put the government even more on the defensive, raising questions about its competence.

But while politically important, the way the cash was spent in the past is a secondary issue. It is over. Nothing can be done to change the past. No one is calling for cuts on previous spending plans. The Conservatives imply that they would spend considerably more on defence and confirm they would match Labour's spending on the NHS. After their experience with privatising the railways they will not be protesting about the level of public investment in recent years. What matters now is the striking disconnect between the demands for more spending in the future and the plans for a tight public spending round that is uncontested by any of the main political parties.

The disconnection is obviously awkward for the Conservatives, who in theory plan to introduce tax cuts at some point in spite of their aspirations to spend more. But for now the challenges are much greater for the Government. Already Gordon Brown hails a familiar dividing line between Labour's support for investment and the cuts that would follow the election of a Conservative government. Yet Brown will struggle to take a bow over the glories of investment when army officers, train commuters and patients fume. They want more spending, not a pause while the incoming Prime Minister collects bouquets for his commitment to investment in the past.

For now, the disconnection will grow. There is no political space for higher taxes at a time when interest rates are rising and while the middle classes already carry the heaviest tax burden. Although there would be a certain rational logic in Brown telling voters that if they want more they will have to pay for it through higher taxes, it would not be the wisest of declarations in the build-up to the next election.

If higher taxes are politically impossible for Labour and the Conservatives seek lower taxes some other forms of fund raising must be sought for the longer term. What would be wrong with the introduction of more co-payments for some services for those that can afford them, a fairly common device in other parts of Europe. It is not entirely a taboo here. Entry to a swimming pool is a co-payment. Why not a co-payment to see a GP at the weekend?

The question will not be addressed in advance of an election. Instead we are trapped in a bind of wanting higher investment but not willing to pay for it. That is why you will hear more about "trust", "terror" and "green issues" in the coming months. They are complex issues, a matter of life and death. They are also politically safe in comparison with debates about the appropriate levels of investment in public services. For most of his time as Chancellor Brown was accused wrongly of spending too much. When he enters Downing Street he will be in trouble rightly for spending too little.

s.richards@independent.co.uk

Comments