Are The Cuts Necessary?

As Britain faces the biggest ever assault on the main planks of the welfare state – benefits, the NHS, education and local Council services, not to mention legal aid – a remarkable proportion of the public still think the pain is needed. The opinion polls disagree on how citizens are reacting to the October spending review. KPMG/Ipsos Mori, for the Times, found that two in three people agree that there is a need to cut spending on public services (59 per cent) compared to a third who disagree (32 per cent), a higher pro-cuts majority than in September. However, a Guardian/ICM poll in late October found that more people now oppose coalition plans for cuts than support them, with 48% of voters saying the cuts go too far, 36% thinking the balance is right and 8% wanting them to go further. That’s 44% pro cuts, compared to 47% in September and 55% in July. But, commented the Guardian’s Julian Glover, ‘there is no full-scale revolt against the coalition measures after last week's comprehensive spending review, with Labour slipping behind the Conservatives for the first time in the Guardian polling series since July.’ Unfair in the choice of what to cut, but overall, inevitable, is the public verdict according the pollsters. (They may be wrong if they fail to speak to those in crisis, the disabled, the homeless, and those who work 60 hours a week to pay their debts – but does the coalition care about those who often don’t vote ? Or indeed about anyone until they face the music in 2015, by which time the limited gains of two generations of the left will have been smashed ?).

But cuts are not necessary, says Caroline Lucas’ latest pamphlet, ‘Cuts, A Callous Con Trick’ (see http://www.financeforthefuture.com/TaxBriefing.pdf - co-authors are Colin Hines and Richard Murphy of Finance for the Future, which works to combat tax avoidance and evasion). The alternative to cuts is a fair, efficient, progressive tax system. By recouping unpaid and avoided tax, by closing many concessions and loopholes for the rich and the big companies, and by restoring rates of personal taxation on high incomes to what they were in the late 1970s, cuts could be avoided. Some of these proposals were already in the Green election manifesto; this pamphlet and a parallel one by Compass (‘In Place of Cuts: Tax reform to build a fairer society’ – see http://www.compassonline.org.uk/publications/item.asp?d=1533 ) comes up with quite a few more.

And the spectre of the suspicious bond markets – or the gnomes of Zurich, as we used to call them in the 1970s ? Well, Lucas et al. note that 90% of British government bonds are held by companies and individuals IN BRITAIN. They probably include your pension fund and mine. And as Lucas shows, the level of UK debt, or the deficit (annual spending minus tax revenue) is not that large by historic or international standards.

The reality of course is that the Coalition just wants to scrap the welfare state. That’s including the right wing of the Lib Dems, who deceived many by preparing for a Tory alliance and Tory policies behind the scenes. The crisis is just a convenient cover and excuse. Britain is just one more instance of the ‘shock doctrine’ described by Naomi Klein in her book of that name – the use of an economic crisis by corporate lobbyists and free-market ideologues to manoeuvre a government into emergency measures that kill off the public sector.

So what to do ? By 2015 the NHS will have been dismembered, managed in effect by the big private healthcare companies and the SERCOs, Capitas, etc which will probably run the commissioning consortia for GPs. Several universities will have been starved into closure. Another generation of school kids will have grown up in poverty with shrinking family benefits, to become as workless as their parents became in 2008-10. Growth, yes, but of drug dealing and prostitution in the streets and parasitic private contractors taking over town halls, hospitals, and job centres. Can we afford to wait another four and a half years for an election ? ‘Building for the next election’ – national or even local – is inadequate; we need to find other and faster ways of stopping the institutional bonfire that is taking place.

Greens have jointed with other forces of the left in the Coalition of Resistance, which drew over 1400 people to a conference in Camden on 27th November (see http://www.coalitionofresistance.org.uk/2010/11/video-from-saturdays-coalition-of-resistance-conference/) . Trade unions, residents’ and health campaigns, and activists from several political parties came together to discuss how to stop the ConDems’ attack on the welfare state. Marches and occupations are becoming the order of the day and John McDonnell, MP drew applause when he suggested that the recent demonstrations to demand Vodafone pay their ‘excused’ tax bills of up to £6bn could be repeated for each of the worst 100 tax-avoiding companies.

Local Councils can play a key part in the resistance. Our Councillors need to be pushed by their workforce and by local residents to refuse to cut services. Thanks to a change in the law in 2000, they can no longer be surcharged as individuals for refusing to follow government directives on Council budgets. (See The Socialist, 18-24 November 2010, on http://www.socialistparty.org.uk/). As that article wisely argues, and as many activists said at the Coalition of Resistance conference, Councils can decide to spend more than the government ‘settlement’ permits, using their reserves and their borrowing powers to buy time and force central government to reconsider. Haringey for example has reserves of over £57 million – larger than the cuts they say they ‘have’ to make. But the reaction of the Coalition should not be under-estimated. The Tories abolished the GLC and other metropolitan councils for continually opposing what they did. Since the millennium, central government has acquired new powers to take over ‘failing councils’. Just as primary health care trusts (though never democratic and not particularly to be mourned!) are being abolished at the stroke of the Secretary of State’s pen, who knows what might happen to local government itself ? This is a struggle which will inevitably go beyond the everyday ‘democratic process’ because that process is itself liable to come under attack.


The danger is that ‘stop the cuts’ will become too vague and general a slogan unless we tell councillors clearly what we want. For a start, we can tell them:-

1) to avoid cuts by using Council reserves and by prudential borrowing. (We can also call upon all opposition forces to support a national position that 'if we are elected, we will work to eliminate debts incurred as a result of this borrowing')
2) to refuse to evict those in rent arrears because of Housing Benefit cuts and take appropriate action against other landlords who do so
3) not to reduce Council Tax Benefit if and when the ConDems’ new welfare proposals are enacted and permit this
4) to use their powers to 'call in' and refer local NHS re-organisation proposals, including GP commissioning consortia, foundation hospitals, cuts in important treatments, preventive services and hospital facilities
5) to reduce wasteful and/or ecologically damaging forms of spending; in short, to review use of energy and fuel, paper, advertising, and procurement generally. The important thing is to save jobs, and to invest in technologies which will create jobs and save the planet

Written by Anne Gray
Haringey Green Party