It’s easy to see the worst aspects of Osborne’s budgetary review. The further cuts to local council funding or the continued attacks on government department budgets, throwing the claim that the government is getting serious on tax avoidance into doubt as less and less staff are available for such important work. If it wasn’t so serious it would also be also easy to indulge in schadenfreude over the failure of the Chancellor to deliver on his priorities of slashing the deficit and enhancing growth as we see the third dip of the double dip recession hove into view.
I thought it might be useful to look at the “strongest” parts of the Chancellor’s announcements. The ones where we might say that, despite all their faults, at least they are getting something right.
The parts of the review Conservatives seem most proud of are funding for scientific research, maintaining international aid budgets, investment in schools and cuts in corporation tax. We aren’t allowed to mention the NHS because while Cameron had been boasting that the NHS has been protected it has turned out there is genuinely getting less money.
Tax
Corporation tax is perhaps the easiest to take issue with. As it stands the rate stands to fall to half the rate that it was when Thatcher took power at 21%. While communities see libraries and nurseries closed down those corporations who are generous enough to bother paying corporation tax are pampered in an age of historic profit. A modest increase in corporation tax could save every library in the UK, a less bashful rise could be used for real investment in jobs doing socially necessary work. A cut is completely shameful in today’s context.
Science
The new investment in science, at £600m, looks and indeed is good news as it comes on the back of a number of other small pockets of investment in scientific research over the last couple of years. However, at best this can be seen as a welcome U-turn rather than a gold star for the report card. In 2010 George Osborne cut longer term funding to scientific research by a whacking 14.4% and on top of that an enormous £1.9bn was taken from capital spending. None of the “new” money we’ve seen since then has been able to fill that hole.
The Coalition government is coming to understand that two policies in particular have harmed the science and technology community – the immigration cap and cuts to scientific research and capital spending have been slammed and slammed again by the community and it is good to see the government wavering on both of these areas but we need a full blooded reversal not these coy economic gestures that only lessen the impact of the damage they’ve already done.
International development
At least with international development the Chancellor has committed to maintain a 0.7% of GDP spending. Sadly as GDP has gone down while inflation has not this is, again, a cut to the budget in both real and cash terms with £254m less money in the pot.
Schools
Then we come to schools. We hear that one billion will be spent on building new schools. Free schools and academies to be exact. This is particularly galling because as soon as this government came to power it cancelled the scheduled investment in schools programme causing tremendous inconvenience to many schools that had to cancel or pause building work already underway. This process was incredibly costly and massively damaging to the morale of schools who had already begun vital building projects.
Osborne’s new money for schools does not reverse the damage 2010’s cancellation did, but it is an implicit recognition that it was a mistake. Sadly much of the money is to go to Gove’s pet projects but he’ll still have 1,000 less staff and slashed departmental funding to in order to try to prevent them floundering, holding off the inevitable disaster of these poorly thought out schools policies.
Silver lining?
I’m always torn when I see a government u-turn, especially under this government who has had so much practice at them. We all want to see a failing policy reversed and it’s good that any government can listen to the evidence and recognise where it is getting things wrong – but so many of these u-turns are the product of a lack of thought through policy making process and often amount to policy wobbles rather than reversals.
When we look at the NHS reforms, free schools and the bonfire of the quangoes all we see is back of the envelope policy wheezes, playing ideological games with services and jobs that millions in this country rely upon. Even at their best this government is failing, even the strongest parts of the autumn review were weak.