Socialist Worker

Don’t believe Tories’ ‘official’ lies on cuts

by Simon Basketter
Issue No. 2209

Civil service workers in the PCS union protest outside the Treasury on emergency budget day last month. They were pointing out that employing more workers to close the “tax gap” of £120 billion of evaded and uncollected tax would eliminate any “need” for

Civil service workers in the PCS union protest outside the Treasury on emergency budget day last month. They were pointing out that employing more workers to close the “tax gap” of £120 billion of evaded and uncollected tax would eliminate any “need” for


Over 1.3 million people will lose their jobs because of the cuts, the government’s own figures showed last week.

A leaked internal Treasury assessment says that up to 600,000 public sector jobs, and 700,000 private sector jobs, would be lost over the next five years as a direct result of planned spending cuts.

But the Tories tried to hide this using their new, supposedly independent body of experts—the Office for Budget Responsibility (OBR).

It’s outgoing head is economist Sir Alan Budd, former advisor to Tory governments in the 1970s and the 1990s. The OCR is supposed to provide non-partisan economic information.

So the OBR rushed forward its own “assessment” of the budget’s impact on public sector jobs—in time for David Cameron to speak in parliament defending the cuts.

The OBR backs up the Tories’ plans for attacks on ordinary people on a daily basis. The only control and checks on it are to make sure it is formally “independent” of the government.

Nobody checks its projections.

This is a major flaw. So, for instance, the government’s figure on job cuts are based on the assumption that the private sector will employ over two million more workers to make up for the cuts.

But there is absolutely no evidence of a new boom on the way—in fact the risk is that the economy will fall back further into recession (see box).

The OBR is predicting that post-recession employment will rise significantly faster than in the 1980s or 1990s—on a slower growth rate.

Here’s another simple example of how the numbers don’t add up. The government is somehow expecting to take more money from stamp duty— the tax on house sales—next year than the previous government did at the height of the housing bubble in 2007.

Justify

The figures of the OBR are presented to us as if they were absolute economic truth, in order to justify the cuts and attacks on the poor.

This is not new. The spurious consensus for cuts in a crisis has always been backed up with “official figures”.

David Lloyd George, Liberal prime minister in the early 1920s, appointed the businessman Sir Eric Geddes to head the new “Committee on National Expenditure”. It was soon dubbed “The Geddes Axe”.

In 1921 and 1922 it led to cuts totalling £87 million—about 10 percent of the country’s entire GDP output. The Geddes Axe meant huge reductions in social benefits and education.

And in the 1970s the Labour government used the IMF in exactly the same way the Tories are using the Office for Budget responsibility today.

We shouldn’t believe the lies and myths spread by the Tories and their allies. Instead we must defend every public service and every job.


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