The Who famously sang; “Meet the new boss, the same as the old boss”. Well, in some ways, that’s what we’ve ended up with. Some will say we HAVE, to quote the famous chorus, been “fooled again”.
At the beginning of October I ventured an opinion on the Truss/Kwarteng so called ‘mini budget’ and the possible fallout. It was not quite, to quote the late Gerald Kaufman, “the longest suicide note in history” – that accolade is reckoned to belong to the 1983 Labour Election Manifesto. It was however far more devastating in terms of what it did to our country’s economy, already reeling from damage, some of it beyond our control but some, many would argue, self inflicted. The dynamic duo clearly had to go.
Chancellor Jeremy Hunt’s recent consigning of the Free Market buccaneers’ manifesto to the dustbin of history, to join other failed attempts at ‘trickle down economics’, and his reworking of Churchill’s “blood, toil, tears and sweat” mantra, appear to have elicited a predictable reaction from the right wing press and the usual low tax, small state Members of Parliament, parroting the kind of slogans that have been around for decades. In some circumstances that means further borrowing. For the rest it means increased taxation.
Nobody likes paying taxes, either direct or indirect, and I would agree that a significant amount of our money has been wasted over the years. However, I’ve regularly come up with this analysis and I have to repeat it yet again. Many of us on these islands have come to expect Scandinavian levels of public services while paying North American levels of taxation. Even with, until recently, one of the lowest rates of tax per income in the west, many of us still live beyond our means.
The Germans have an expression; “Die Briten leben auf Pump” (trans: ‘The British live on tick’). When I was growing up in the 1950s we did have ‘hire purchase’ on goods, but nothing like the easy credit of the past forty years. Barclaycard came along in 1968 and, in 1972, we had Access to “take the waiting out of wanting”. You probably know the rest.
Most countries, developed or otherwise, are having problems as we (hopefully) emerge from the COVID pandemic and many in the West need to readjust their economies to cope with an aggressive Russia and the threat from climate change. However, our country has conceded own goals, prominent amongst them being Brexit, which is far from ‘done’, despite what many enthusiasts would have you believe. However there is precious little mileage in advocating rejoining the EU at present, even if our former partners would even consider having us back. We clearly are not alone in having to tighten our belts. The trouble is that we have further to go than most to get back to where we were before COVID struck.
Having tried austerity before, after the financial crash of 2007/8 – something I witnessed at the sharp end at Lincolnshire County Council, like most others reliant on a Central Grant, saw it cut progressively from 2011. It was accompanied by a bribe from central government in the form of the Council Tax Freeze Grant not to raise the level of Council Tax, first at all and then by not more than by 2%, unless they wanted to face a local referendum. The result over the period 2013 to 2017 when I was one of four Lib Dem and three independent councillors who formed part of the Tory dominated ruling coalition, was a massive reduction in council staff and the services it provided. Some of these were replaced by ‘commissioned’ services from the private sector. You can see the logic in this decision. Let the private sector pay the on costs such as pensions and NI contributions etc, even if the profit motive has to play a part in any deal. So many local councils have, willingly or not, become purchasers rather than providers of many of the core services we rely on. Other services, such as libraries, have been saved only by being ‘privatised‘ and, as far as Lincolnshire is concerned, are now to a great extent sustained by volunteers, of which I just happen to be one.
To pay for much of this we have had to rely on the Council Tax. The problem is that it is a regressive tax and based on property values of thirty years ago. A proper property revaluation was undertaken in Wales in 2003 but England still awaits. If it ever does happen, many people will be in for a shock. This tax on the value of property was never intended to cover more than a third at most of the cash a council like Lincolnshire needed. Now it accounts for around 50%. We really can’t go on like this.
I have written before about streamlining local government. Does Lincolnshire really need seven District Councils as well as a County Council, let alone three hundred plus Town and Parish Councils? I’d leave the latter in place with the possibility of enhanced powers, but would replace the County and District Councils with two or possibly three Unitary Councils. Local government finance also needs urgent reform. A local tax based on an ability to pay, such as Local Income Tax or Land Value Tax, makes a lot of sense. However, reforms to local government are only part of the problem. With our ageing population, we still haven’t sorted out how to pay adequately for adult social care let alone for health care in general.
So, as they say, “We are where we are”. Given that our economy is not likely to recover any time soon, we need to get some, if not all, of our ducks in a row with what we have left and what we are collectively prepared to pay for. Firstly, we need a grown up relationship with our nearest trading partners in the EU, starting with sorting out the mess in Northern Ireland. As for the thorny issue of ‘free movement of people’, I may be naive but I really can’t understand why that all couldn’t accept “free movement of LABOUR’. In order to avoid even more cuts in public services, given that growth in our economy is not likely to kick in for some time, we really cannot avoid a hike in the basic rate of income tax and an increase in rates for taxes on higher incomes as well. You can go on about eliminating ‘waste’ and I am sure a good case can always be made for this. However, for the time being I see no alternative, however unpleasant as this may be.
I ended my previous piece suggesting a General Election. Fat chance of that in the present situation. It looks as if this government will drag on to the bitter end. Quite frankly I’m not inspired by the official opposition either. However, under our present voting system, that’s all we appear to have as an alternative, unless the non Tory parties can find some way of working together. It does feel a bit like the fag end of John Major’s government to me, and we all know how that ended. Is Sir Keir Starmer the new Tony Blair? Oh, I hope not!
John was a councillor for thirty years, finally retiring in 2017. A schoolteacher by profession, he served on the North Hykeham Town Council (1987-2011), the North Kesteven District Council (1987-1999, 2001-2007) and the Lincolnshire County Council (2001-2017). He was also a County Council member of the former Lincolnshire Police Authority for eight years until standing down in 2009. In 1997 he was the Lib Dem Parliamentary candidate for Sleaford and North Hykeham. He is currently not a member of any political party.