Post by Focus on Jun 3, 2013 10:06:58 GMT
Ed Balls tells shadow cabinet it must plan on having the same government funds as the coalition if it wins power in 2015.
Ed Balls says the shadow cabinet will need iron discipline over spending
The shadow cabinet must plan on the basis of the same spending totals as the coalition, Ed Balls has said as he sets out a series of likely cuts to government spending, including abolition of police commissioners, means testing the winter fuel allowance and freezing the building of further free schools.
In possibly his most important speech as shadow chancellor, Balls told the shadow cabinet "we cannot plan now on the basis that our inheritance in 2015 will be better than currently forecast", adding that this would require further deep departmental cuts in spending.
He also hinted he would reinstate the top tax rate at 50p, reduced to 45p by the coalition, and said if there was any growth in the next year he would shift his emphasis from a temporary VAT cut to capital investment, praising the IMF's call for an extra £10bn in capital spending.
Balls also set out fresh details of the zero-based review of budgets he would implement after the election, promising publication in spring next year of summaries of how public service reform can be redesigned.
He said shadow cabinet members had to plan on the basis of switches within departmental spending, rather than any major increase in budgets.
The speech, delivered to an audience at Thomson Reuters on Monday
morning, was a major effort by Balls to show he could impose iron discipline on public spending and yet offer a more expansionary growth-orientated economic approach requiring extra short-term borrowing for capital investment over the next two years.
The Labour leader, Ed Miliband, will take the iron discipline message a step further on Thursday by proposing a cap on welfare spending not linked to the economic cycle.
Balls said the zero-based review revealed to the Guardian last year would be guided by how Labour could use public money more efficiently; create growth and ensure consumer choice in service delivery, as well as fairness.
Indicating some early thinking on specific savings, Balls questioned whether it made "sense to have separate costly management and bureaucracy for so many separate government departments, agencies, fire services and police forces – the same number as when this government came into office – all with separate leadership structures and separate specialist teams".
He also proposed that industry should share the cost of their regulators, a merger of the four agencies working for motorists, a takeover of the delivery of High Speed 2 by Network Rail, a rethink on Titan prisons, a cut in the number of senior officers in the navy and army, and a merger of health and social care services.
He suggested structural changes to budgets to give priority to preventive spending – "early years spending, support for troubled families, public and mental health services, scientific research into new cures and treatments – areas where spending now saves billions in the future". Gordon Brown ran a similar programme entitled Spend to Save.
In other broad hints at his thinking, Balls asked whether further free schools in areas of excess capacity should be opened in 2015-16 if primary school places were in short supply in many parts of the country and parents were struggling to get their children into a local school.
Previewing the finding of Labour's Independent Stevens Review into the future of policing, he hinted strongly at the abolition of elected police and crime commissioners, asking "when we are losing thousands of police officers and police staff, how have we ended up spending more on police commissioners than the old police authorities, with more elections currently timetabled for 2016?"
As previously trailed he also opposed paying the winter fuel allowance — a vital support for middle- and low-income pensioners — to the richest 5% of pensioners.
He insisted: "Because of the overall financial situation we inherit, and the need to look ruthlessly at every pound we spend, the relentless focus of my shadow cabinet colleagues must be on how to re-prioritise money within and between budgets for current spending, rather than coming to me with proposals for any additional spending.
"Any changes to spending plans for 2015-16 must be fully funded, agreed with Ed Miliband and myself, and set out in advance in our manifesto.
Labour leader, Ed Milliband
"To serve the country and win its trust you cannot prepare now on any basis other than that you will inherit very tough spending plans from this year's spending review. They will be our starting point.
"We know these plans for current spending in 2015-16 are likely to place a very significant burden on public services. We cannot decide now to spend money that we do not know, and do not expect, will be there."
But he said he would not play the Tory game of setting out his precise spending and borrowing plans ahead of the coalition spending review in June. He also said he would not set out his fiscal rules at this stage.
"With the chancellor refusing to change course, Labour must start planning now for what will be a very tough inheritance in 2015. It will require us to govern in a very different way with much less money around. We will need an iron discipline and a relentless focus on our priorities".
In the short term, Balls said, he supported the IMF's call, consistent with medium-term fiscal consolidation, for the government to act to boost capital spending over the next two years – financed by a temporary rise in borrowing as Labour has also urged — "to build our way to a stronger recovery".
"If the entire infrastructure boost recommended by the IMF was spent on housing over the next two years, we calculate that it would allow the building of around 400,000 affordable homes across the country, and support over 600,000 new jobs in construction, including 10,000 apprenticeships." -- ["With the chancellor refusing to change course, Labour must start planning now for what will be a very tough inheritance in 2015. It will require us to govern in a very different way with much less money around. We will need an iron discipline and a relentless focus on our priorities".]
Well talk about jumping the fcking gun!! - Do these morons really believe that the British public would trust the Labour party again after their last performance ffs?? - Fx
