The scale of the public sector cuts envisaged this week ought to sharpen everyone’s attention
Paul Waugh: ‘’
Well, after this week’s pre-election Budget and its confirmation of projected spending cuts, it now looks like the boot is on the other foot. Yet as Labour maintains a big lead in the polls, the onus on Rachel Reeves to explain her alternative plans gets even greater. To avoid repeating the Conservatives’ cuts, Reeves and her team may lean into the idea of productivity savings in the public sector. Digitisation and AI could indeed yield savings that were previously a pipedream.
More pressing for Reeves is the need to fill the hole caused by Hunt’s theft of her non-doms policy . The money was earmarked for cutting NHS backlogs, more dental appointments and breakfast clubs in all primary schools – all vital policies that will give an early signpost of the wider intent of a new Government. Change has to be credible and believable as well as sustainable – and so does its funding.
Maybe Reeves should consider a one-off windfall tax on the banks, who have been raking in billions in profits off the back of higher interest rates. During the early 1980s recession, even Margaret Thatcher slapped a 2.5 per cent levy on bank profits to raise cash.
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