Treasury Tricks


Gordon Brown was notorious as Chancellor for announcements that looked and sounded good on the day, only to unravel as theatrics and wheezes became apparent as experts got to examine the figures. He managed to turn ‘the devil is in the detail’ from a infrequently used aphorism into an Iron Law of Budgets.

Despite a brief WYSIWYG interregnum under Alistair Darling, it seems we are back to Treasury Tricks as the order of the day. Last weeks Spending Review is already unravelling as dodges, spin, wheezes and downright lies gradually emerge from the thicket of numbers.

First, the accounting tricks. HM Treasury famously preens itself as having a collection of the very finest minds Oxbridge can produce – a pity then their principle activity seems to be devising spiv like ways of deceiving the punters.

Health

Let’s take the ‘the NHS is safe in our hands’ pledge first. SR 2010 met the pledge give the NHS real-terms increases on paper, just barely. A 0.1% annual increase was enough to claim the pledge fulfilled. Except dig a little deeper. £1bn (almost 1%) will never go anywhere near the NHS. It is going to local government to pay, supposedly, to get ‘bed blockers’ out of hospital. It takes all the talents of an Oxfbridge educated Mandarin to justify that as spending on the NHS. Especially when the £1bn goes into a no-longer ring-fenced local government budget that could end up virtually anywhere.

And that doesn’t even start to scratch the surface. As Polly Toynbee has pointed out, as whole raft of other changes will undermine the NHS budget – £3bn worth of re-disorganization costs, £20bn of ‘efficiency’ savings, etc not to mention health inflation and rising demand.

Education

The trick in Education has been to claim that ‘schools are being protected’ and there’s £2.5bn extra for poor pupils, but in reality the schools budget only stands still in real terms if you include the “extra” money for the Lib Dems beloved pupil premium. At that if course doesn’t take account of the immediate and longer term costs of so-called ‘free’ schools.

Policing

Policing only cut by 16%, not the 25% that was feared – only 18,000 police officers cut and not 35,000. But dig deeper and you notice that the real cut is 20% of funding from central government and police authorities are expected to raise the police precept to make up the difference.

Council tax

Frozen, or is it? If the police precept has to rise the actual tax bill landing on people’s doormats will rise, even if the local government element is frozen. Or are local councils expected to cut their income even further to meet the rise in policing tax? It takes special kind of tricksy logic to call this ‘frozen’.

So all the fine headlines about protecting the NHS and schools, cutting the police less than expected and freezing council tax which sounded so impressive on the day turn out to be Treasury Tricks. I’m sure there are lots more buried away in the detail (and if you spot any let me know).

And all these are without all the rhetorical tricks in Mr Osborne’s narrative:

Labour caused the fiscal crisis (they were at worst only responsible for about a quarter of it, we have the banks to thank for the rest);
We are ‘back for the brink’ (we are not Greece, or even Ireland, and we were nowhere near the brink);
We are not asking the next generation to pay for today’s services through debt (funny how that doesn’t apply to students);
We ‘avoided ending up in thrall to foreign bankers’ (only about 30% of UK government debt is held abroad);
and on and on went the half-truths, spin and down right lies. All governments engage in these sort of tricks – New Labour and especially Chancellor Brown were notorious for them – Mr Osborne and his friends are just following in their well-trodden footsteps.

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About Prof. Colin Talbot

Professor of Government (Emeritus). Universities of Cambridge and Manchester, England.
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One Response to Treasury Tricks

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