The Labour party used to joke that the Tories would act as their cleaners: win, take the political pain, abolish the deficit by 2015 and then hand over a balanced budget when they lost the election. George Osborne has, at the very least, put paid to that. His Spending Review this week made it clear how painfully little progress is being made. Whoever wins the next election could close every school, open every prison, cede Northern Ireland, close every embassy and sack every soldier, sailor and airman — and it would still not be enough to put the government back in the black. Britain is a terrifyingly long way from fiscal sanity.
If the Chancellor had actually cut the government machine when voters expected him to, the pain would be almost over by now. Instead he has given himself eight years to cut total government spending by just 2.6 per cent. When the Labour government was forced to find savings by the IMF in 1976, it managed more than this in under a year. Like a child peeling a plaster away slowly in the hope of minimising the pain, the Chancellor has gone for slow-motion austerity. This has certainly kept the government machine fatter for longer. It may also have condemned Britain to a lost decade.
At first, Mr Osborne — ever the political strategist — had hoped to balance the books before the election and celebrate with a tax cut. This ambition now seems laughable, and it’s not entirely his fault. It took a bit longer to realise not just the extent of the damage inflicted by Labour but just how much of its ‘prosperity’ was a debt-fuelled illusion. After two years it became clear that the programme that Mr Osborne first outlined (shaving state spending by just under 1 per cent a year) was never going to be enough.
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