Is it time to get specific about our ‘Alternative’?

By Lucy Rigby / @lucyrigby

In his Hyde Park speech to the TUC’s March for the Alternative rally on Saturday, Ed Miliband restated the Labour Party’s stance to date on the government’s cuts: he said that he recognises, given the deficit, that some cuts to public spending are necessary. Some of those marching on Saturday will have agreed with this; others believe that there should be no cuts at all and indeed carried placards to this effect.

It was important that Saturday’s march was inclusive of both views – there were many marching who held these positions and doubtless plenty more who consider themselves somewhere inbetween. Up until now, it has not been necessary to define too closely the “Alternative” which we all marched for on Saturday – in fact, arguably, it was important that the alternative was not defined – the broad principles were there (too far, too fast; too many public sector jobs; too reckless; too unfair; too easy on the banks) and, in any case, we each have a broad understanding of what our own Alternative would be.

Also of course, the party’s decision not to produce an alternative budget doubtlessly has strategic advantage: there is no need to do so – we’re ahead in the polls, creating one would tie us to specific policies which we may want or need to jettison at a later date and, most simply, would needlessly open us up to government critique.

Despite his comments to the contrary, the fact that Ed Miliband addressed Saturday’s rally (as he – I believe rightly – committed to do months ago) has allowed the government and other critics to brand him in the media as possessing of the “no cuts” view. This is on the back of the last few months during which Tories have seized upon the remark that the Labour Party has before it a “blank page” and they’ve used it as a stick with which to beat us. When we voice our concern regarding one particular proposed set of cuts or another, the government’s response invariably begs the question “well, what would you do?” and refers to us as being any one of deficit-denying, rudderless or devoid of ideas (and often all three).

So, is it time to start fleshing out our alternative? I think, in large part, it is not. (You’re probably thinking at this point that the title to this article is misleading and indeed wondering what my point is but bear with me for a minute). The current strategy is, overall, likely to be the most sensible one – I think each of the benefits of refraining from putting together a full alternative budget (as above) probably, on balance, still stand. However, certain of the government’s proposed tax cuts/changes contained in Osborne’s most recent budget (although this was, in effect, only tinkering – it was fiscally-neutral and it would be a mistake to be distracted from the far more important growth forecast) have presented us with an opportunity to put some meat on our alternative’s bones: we could, based on these most recent proposals, produce several specific and concrete examples of how we, as a Labour Party, would do recovery and growth differently.

For example, the planned cut to corporation tax, from 28p to 26p is projected to cost the Treasury £3.1 billion by 2015 – 2016. The changes to the rules surrounding the taxation of foreign-controlled companies is set to cost us £2.3 billion. Could we say that we wouldn’t offer the latter set of changes and would instead only cut corporation tax by half as much? We could then allocate this £3.8 billion elsewhere – perhaps to retain a few thousand jobs in the public sector? It would be important that we allocate the sum to something which could be labelled growth-creating (just as the Tories suggest that their lowering of business tax rates do the same) because the inevitable come-back from the government benches would be that our lesser proposals would not encourage as many companies to come back to or remain in the UK and therefore engender as much growth as theirs.

The dividing line between us and them then more clearly becomes our differing approaches to growth: the Tories want only to encourage businesses to thrive; we want this too, but we do not want it to be at the expense of high unemployment and rising inflation. This is just one example, but you get the idea.

It goes without saying that some of these specifics may involve acknowledging that there were some areas requiring of change which we did not tackle when we were in government and agreeing, in principle, with the Tories’ policy. For example, with regard to the so-called “Learjet Levy”, we could welcome the government’s proposal that those flying in private jets should pay Air Passenger Duty but argue that the rate of APD (the same as the highest rate for regular, commercial flights) to be imposed is not high enough – why couldn’t we say that we’d double it, or triple it, for private flights? I don’t know how much this would bring into the Treasury’s coffers but presumably we could allocate this extra cash to a green initiative, or to lowering the bottom rate of APD that most of us pay on budget flights such that the charges are distributed more appropriately (fairly?) across the range of different types and prices of air travel.

This last point leads me to my final suggestion: even if we choose not produce specific examples of what our alternative might look like, could we add some colour and/or substance to our scrutiny by saying instead that we would measure each of the government’s proposals against a set of firm criteria or values? These principles could, for example, include a (admittedly high-level) requirement that any package of tax reforms must be adjudged (by the IFS?) to have a proportionate impact across various income levels – or perhaps even to be “progressive”. These values would provide the test or benchmark by which we could assess theg overnment’s policies and would, by implication, form the basis of our own prospective ones.

In conclusion then, I should say that I’m not sure that any or all of the ideas above are necessarily the right approach for us to adopt. However, I hope that by putting finger to keyboard, I might add to the debate….

Lucy is a Labour Councillor is Islington.