Election reality that dare not speak its name

April 27, 2010

– Neil Collins is a Reuters Breakingviews columnist. The opinions expressed are his own –

Since Labour came to power in 1997, it has pursued a policy of expanding the numbers employed by the government or its agencies. The result is that today 6.1 million people are on the state payroll, an increase of about 900,000 in 13 years.

They are also paid, if not well, then at least comfortably. The Office of National Statistics calculates that pay in the public sector is now higher than in the private sector (462 pounds and 451 pounds a week respectively). It’s also rising faster (3.7 percent, against 1.8 percent).

Add in greater job security and the final salary pension schemes which are almost extinct everywhere else, and it’s easy to see why those in a recession-wracked private sector are resentful. Yet in over 60 constituencies, more than a third of the workforce is on the state payroll. Apprehensive politicians see public sector employees, along with their families and their client base of welfare claimants, as a block vote.

The last budget sketched a path back towards fiscal stability, but published no individual spending department limits beyond next March. Behind the scenes, departments are planning for draconian measures, while Labour is hoping nobody will notice the mismatch between this silence and its plan to cut 37 billion pounds from public spending by 2014.

Scrapping aircraft carriers, IT systems, ID cards and other follies would hardly dent the problem. Cuts in school building and roads will help, but serious money saving requires frozen and means-tested benefits and, say, a 5.5 percent cut in public sector pay. Even these contentious measures save only 15 billion pounds according to an Financial Times analysis, much less than half the amount required.

No politician has dared admit that public sector cuts of this order are inevitable. The televised debate on April 29 provides almost the last chance to face reality before the vote on May 6, but the numbers are so horrible that the viewers will probably be spared them. After all, there’s an election on — although given the outlook, it’s hard to see why anyone would want to win it.

(Editing by Hugo Dixon and Aliza Rosenbaum)

Comments

There is one simple thing that could solve the whole problem, and it is more radical than anything mentioned here. We should all simply admit that health has become a false religion. Increasing life expectancy does not increase well-being. Cap total health expenditure – public and private – at 5% of GDP. We are going to have to get to grips with the problem of health expenditure, which is growing out of control regardless of whether it is funded publicly as in the UK or privately as in the U.S. at some point, and there is no time like the present.

Posted by Osomec | Report as abusive
 

The galloping growth of unproductive public spending is labour’s capital crime against the nation.

The best new legislation that the next government should implement would be to cap public expenditure as a maximum %age of GDP.

At the same time all elected politicians should become legally accountable to the voters.

Posted by investeast1 | Report as abusive
 

Its simple.. the big three dont want to admit that the country will be bankrupt by 2014..

But Europe is costing the tax payer 45 million a day.. that alone is more than all there cuts they can muster..

You dont have to be a member of Europe to trade with Europe.. its a common misconception..

The press has played a part making sure the most obvious choice and only common sense party that could deal with the soon to be disaster has been stripped of all media privileges, even though they came second ahead of Labour in the European election results last time round..
four letters starting with U.K ..
Nigel Farage for PM..

Posted by Che2day | Report as abusive
 
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