The election battle to come – but are we ready?

By Duncan Weldon

The major news on the ‘political economy’ front this week came on Wednesday with Andrew Lansley’s comments on cutting 10% of public spending, excluding health and education. ConservativeHome was quick to attack this for not going far enough.

Prime Minister’s Questions gave a prelude to the election battle to come. I welcome that the next election will be openly fought on the basis on how to close the deficit and that debate will be had on the level of public spending. But I fear that Labour is not quite ready to have this debate.

What became painfully apparent watching Andy Burnham interviewed by Nick Robinson on Wednesday night is that the old, and simple, line of ‘Tory Cuts versus Labour Investment’ won’t work this time around.

That line, which served the party well in 2001 and 2005, was effective in the context of a buoyant economy. The Tories at the time talked of ‘sharing the proceeds of growth’ and it was easy to frame this as a tax and spending cutting agenda, a task made easier by comments from Oliver Letwin in 2001 and Howard Flight in 2005.

This time around, regardless of whether the economy is growing or not, the conditions will be different. There is a genuine need to close the budget deficit and a very strong case for actually starting to pay down the public debt. Businesses and households have been forced to tighten their budgets and a general sense that the government should too is hanging in the air. The public believe that a party of either colour will cut public spending. And they are right.

So we can’t simply say ‘Labour investment, Tory cuts’. The argument is now more nuanced and we need to find a way of articulating that we favour modest cuts, and tax rises such as the popular 50p top rate, whilst the Tories favour more savage cuts.

It is electorally difficult to be honest about these issues and the Party still bears the scars of the 1992 ‘Labour’s Tax bombshell’ campaign. But unless we can clearly set out how our plans for public spending and taxation, then it will be hard to attack the Tories.

I think the public might welcome honesty on this issue. We should set out that times are going to be difficult for a little while and that maintaining the services that people need and identify with will cost money. Polling evidence suggests that whilst the public are in favour of cutting government spending in general, they are against most specific cuts. So let’s set out our plans and then challenge the Tory ones.