The Times: Parties let us believe we can have it all

Peter Riddell
Offer politicians or voters a hard choice and they, or rather we, prefer to fudge it. Whoever thought up the Conservatives’ slogan about “sharing the proceeds of growth” accurately caught the public mood: we want it all. That is, of course, why this approach was adopted not just by the Tories but also by Labour and the Liberal Democrats.

These ambiguities are caught by the latest Populus poll for The Times, undertaken over the Bank Holiday weekend (for more details see www.populus.co.uk). If the Government had additional funds available, which of three options would voters prefer? There was a roughly even split between using “all the additional funds to increase spending on public services” (backed by 27 per cent, a fall of five points since last October) and using “all the additional funds to reduce taxes” (favoured by 26 per cent, a rise of one point). Tory voters favour lower taxes over increased spending by 30 to 24 per cent; Labour voters prefer spending over tax cuts by 37 to 18 per cent.

The largest group - 43 per cent, down only one point since last October - are those who favour “sharing the additional funds between increased spending on public services and on reduced taxes”. Who wouldn’t? In theory, it is possible over the long term to share the proceeds because additional tax revenue can be divided between a real growth in spending and lower taxes.

In practice, governments either accelerate or rein in spending: new Labour was unusual in starting with two or three years of famine before seven years of feast and now a long period of slimming.

Attitudes on tax also fluctuate. The British Social Attitudes survey shows that, in the early Thatcher years, 54 per cent favoured keeping taxes and spending on health, education and social benefits at the same level. This fell to about 31 to 34 per cent by the 1997 election. Over the same period, support for increasing taxes and spending more on services rose from 32 to about 60 per cent. By the time of the last election in 2005, however, backing for more spending was down to 46 per cent, and staying the same was 43 per cent. Several recent polls, including the annual YouGov surveys for the Taxpayers’ Alliance, have highlighted increasing scepticism about whether the expansion in government programmes is being efficiently spent, as well as growing resistance to higher taxes.

As the Populus and other polls show, most voters think that taxes can be cut without public services suffering. The main parties are only too keen to indulge this delusion, whether by efficiency savings to eliminate waste or by promising to cancel controversial schemes, such as ID cards, but this is an intellectual and political cop-out. The only way to achieve the goal of “sharing the proceeeds of growth”, that is keeping the expansion of spending below the expansion of the economy is by squeezing, and ultimately cutting back budgets. We cannot eliminate child and pensioner poverty, support the military, have better schools and hospitals within 2 per cent real growth in spending, as the Government and Opposition claim. The truth is less comforting. Something has to give. We cannot have it all, but don’t bet on any party saying so.