Concrete steps? The whole thing is based on a false premise

By Will Straw

David Cameron’s big speech today was based on a false premise. Having set this out he offered virtually no “concrete steps” to address it aside from cutting tax credits.

The speech started with Cameron’s view of the problem:

“Unless we take concrete steps to start reducing this massive debt, the recession will get worse and the recovery will be delayed.”

The recession is certainly putting pressure on the public finances but Britain’s debt to GDP ratio is the 8th best in the G20 and top of the G7. Cameron’s statement is merely an attempt to explain his opposition to a stimulus package, which is a position that puts him at odds with every country in the G20 except Turkey.

The main chunk of the speech related to how he would take long term control of public spending. He set out his “concrete steps” by saying: “We can afford school reform because the Government is already planning to spend billions of pounds … We can afford welfare reform because – as David Freud report has shown – getting someone back into work or keeping them out of long-term unemployment actually saves money.”

But as he says in his own words, Labour is already taking these steps. Indeed, David Freud wrote his report “Reducing dependency, increasing opportunity” for the Department of Work and Pensions.

The real “concrete step” came at the end when, in Orwellian terms, he obfuscated that the tax credits system, “is clearly an issue that we will need to examine.” But as the independent Institute for Fiscal Studies has shown, “Labour’s tax and benefit reforms have been strongly progressive, and furthermore have focused resources on two particular groups – lower-income families with children, and pensioners.”

So be clear what you’re getting with the Tories: no measures to address the current crisis, stealing Labour measures to bring the public finances under control, and an end to the tax policies that have lifted thousands out of poverty.