<<back to articles

THE TORY CUTS PLAN

The Tories will need to make massive cuts to front-line public services in order to deliver their commitment to cut public spending by £35 billion.

All of the Tories claimed ‘savings’ contained in the James Review (a report which details proposed savings and efficiencies launched in Jan 2005) fall apart under detailed scrutiny. The vast majority of James Review proposals are not efficiencies but straight forward Tory cuts to public services – cuts so large that they could only be found from cutting deep into front-line services, for example:

• Abolishing the Union Learning Fund (ULF) is not an efficiency saving – it is a cut that would end new learning opportunities for thousands of workers (over 60,000 last year alone). This would result in fewer adults with basic literacy or numeracy getting training. Since its introduction in 1998 over £50 million has been made available to support the ULF. It has supported over 490 projects, in over 3,000 workplaces. Over 100,000 workers have been helped back into learning, by 8,000 Union Learning Representatives, at 400 new learning centres. With help from the Fund, over 270 learning agreements have been signed by unions with employers. The budget for 2004-05 is £14.4 million under Labour but will be zero under the Tories.

• Scrapping the New Deal and privatising Jobcentre Plus is not an efficiency saving – it is a cut that would mean an extra 300,000 people on benefit by the fourth year of a Tory government, costing well over £2 billion extra a year in increased benefit expenditure and lost tax revenue. The New Deal has helped over a million people into work, including half a million young people, resulting in the lowest unemployment for thirty years.

• Abolishing the Agricultural Wages Board (AWB) is not an efficiency saving – it is a cut that would take away vital minimum pay and terms and conditions protection from thousands of low-paid agricultural and rural workers covered by the AWB. Removing such vital protection from thousands of rural workers will not help the countryside or the local economies of rural communities.

After opposing the introduction of the National Minimum Wage (NMW) and consistently opposing subsequent rises, the Tories are still refusing to give a commitment to retain the Low Pay Commission – the body which sets and oversees the operation of the NMW - and therefore the Minimum Wage itself.

The Liberal Democrats described last year’s rise in the NMW as ‘dangerous’, and have still not revealed the size of wage cut workers on the NMW would suffer under a Liberal Democrat Government.

• The proposal to slash 80 per cent of staff at the DTI is not an efficiency saving – it is a cut that would devastate the department, (leaving a skeleton staff of 850) putting in jeopardy crucial work in the areas of employment law, family friendly policies and trade union rights.

• Scrapping the Partnership at Work Fund is not an efficiency saving – it is a cut which would undermine efforts to improve employer-employee relationships, workplace productivity and job satisfaction. The Tories’ have also failed to commit keeping the Union Modernisation Fund which assists unions with more innovative ways of working, better long-term strategic planning  - helping unions to adapt to changing labour markets.

• Slashing £500 million from the DTI’s business support programmes is not an efficiency saving – it is a cut that would damage business, trade, R&D, inward investment and British competitiveness.

• The proposal to scrap Regional Selective Assistance is not an efficiency saving – it is a cut. Over the last four years RSA has levered in £10 of private money for every £1 put in and has secured almost 100,000 jobs in some of the most deprived areas of England.

• Replacing 700 UK Trade and Investment (UKTI) staff and secondees with 50 “business lead champions” is not an efficiency saving - it is a cut, the impact of which would mean little or no national-level support at the UK end for potential inward investors and UKTI would not be able to help fledgling UK-based exporters. Discontinuing grants to Regional Development Agencies would end UK regional support for inward investment.

• Cutting over £1 billion from the housing budget is not an efficiency saving – it is a cut that would mean fewer homes, less affordable social housing and increased homelessness. It would mean 26,000 less part-subsidised homes for first time buyers. Alternatively, it could mean scrapping the entire investment programme in the Thames Gateway, reducing the supply of housing, especially to key workers. It would mean fewer jobs for construction workers and damage the construction industry.

• Cutting Local Education Authority budgets by at least £1 billion is not a saving – it is a cut that would see massive cuts from the budgets that cover Special Educational Needs, school transport, anti-truancy and anti-bullying programmes. The Tories are also committed to cuts to OFSTED – including cutting staff numbers by one third - that would weaken the schools inspection service and allow schools with behaviour problems to go unrecognised and untackled for longer periods.

• In addition to their £35 billion cuts, the Tories are committed to a further cut of £1 billion to schools. Their schools voucher scheme will use taxpayers' money to subsidise fee-paying parents and transfer millions from state schools into private schools. Over £1 billion would be cut from schools to pay for the Tories' bureaucratic and costly voucher scheme. Money cut from schools for all children for the purpose of subsidising the private education of a privileged few. The Tories estimate that about 176,000 independent school pupils (about 30 per cent of the current total of 589,000) would be able to get the £5,600 voucher at a cost of £989 million. The costs of setting up such a bureaucratic system of vouchers would take the total costs way over £1 billion.

• The Tories are committed to a further £1.2 billion cut to the NHS. Conservative policy is not only unfair, it is an inefficient use of public money since it will take at least £1.2 billion from the NHS investment to subsidise the cost of private treatment for those who can afford to pay, without producing one more operation. Tory policy turns the fundamental principle of the NHS on its head. Under the Tory plans access to timely operations will be on the basis of ability to pay, not patient need.

‘Well first of all this policy involves handing out piles of cash to people who would've gone private anyway. So who benefits from the policy? Not the most needy, or the most sick, but those who could afford private treatment. And it also breaks a very important principle, until now NHS money has been used to care for everyone but under this plan it'll be used to benefit the better off.’ Niall Dickson, Chief Executive of the independent health charity, the Kings Fund, Politics Show, 5 October 2004

The question the Tories must now answer is how many doctors, nurses, teachers, police officers and other public sector workers will be cut? How many schools and hospitals would they close?

Oliver Letwin has admitted that the scale of the cuts they are proposing would not be “painless”.

“It’s not painless. There’s no point in trying to pretend it’s painless”

Oliver Letwin, BBC World at One, 10 January 2004

<<back to articles