Thursday, May 27, 2010

Six Billion Out of the Deficit is the First steps to Dismantling the Welfare State? I rather think Not


Most people still in possession of their faculties are in agreement that reducing the budget deficit has to be the most urgent priority of the new British government. That incidentally is the consensus among Europe’s leading economies also. Indeed there are a good many among us who have raised the possibility that taking the equivalent of just 1% out of the national debt just may not be going quite far enough. Some experts have gone so far as to argue that at the very least 20% will need to be cut from the budget of every government department if the worst deficit sine the Second World War is to be brought to heel. The horrible irony being that that deficit was run up fighting the existential threat Nazi Germany posed to the nation’s survival, this one on the other hand has been run up by Gordon Brown fighting an existential threat posed by reality. The threat of course being to his own career, not to our national survival.

Yet Brown and his party in its dying days are not the only ones who seem to have preferred putting their own self interest over that of the national one. In response to the Queen’s Speech that laid out the new British government’s plans for reducing the national debt the public sector union PCS alleged that this was a dastardly attempt to start the process for the dismantling of the Welfare State. If only. But since when exactly were quangos and frivolous levels of government advertising part of the Welfare State? Of course the PCS doesn’t really believe that taking six billion out of the budget will signal the end of the National Health Service but rather they fear that cutting government waste could put their own pay packets on the line.

However the savings can not come from internal government administration alone. Reducing the number of paper clips and potted plants in civil service offices will only get you so far. The fact is that the annual cost of welfare in Britain is 200 billion pounds alone and much of that is spent on unemployment benefits and state pensions. Clearly some reductions will have to be made in this area also. Its either that or the nation continues borrowing 3 billion pounds a week as it was doing by the end of Gordon Brown’s time in government. Unfortunately the PCS seems to favour the latter as the more viable of the two options. They must be pretty much on their own with that one.

Sadly for those of us that hoped that the old Trade Union Left had been permanently consigned to a well deserved combination of obscurity and mundanity it looks like the year ahead could be rather a disappointing one.

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