Balls tries to show that you can trust Labour with your money

The shadow chancellor's pledge to justify "every penny" makes political and economic sense.

"Are you ready to trust Labour with your money again?", asked Nick Clegg in his conference speech. The announcement by Ed Balls that Labour, if elected, would hold a "zero-based spending review" is an admission that he still needs to convince voters that they can answer "yes". The record £159bn deficit may have been a consequence, rather than a cause, of the economic crisis but Balls rightly recognises that Labour didn't always spend wisely in office.

A zero-based review (an idea proposed last December by In The Black Labour) differs from others in that it requires every item of spending to be approved, rather than merely changes to a pre-determined baseline. In other words, nothing is off the table. As Balls says in his interview with the Guardian:

The public want to know that we are going to be ruthless and disciplined in how we go about public spending. For a Labour government in 2015, it is quite right, and the public I think would expect this, to have a proper zero-based spending review where we say we have to justify every penny and make sure we are spending in the right way.

He goes on to add that the review will be subject to three qualifications. First, that Labour will commit to protecting spending in certain areas, such as international development and possibly health, based on its priorities of fairness and growth; second, that it will examine whether "cuts now would lead to higher costs in the future" (for instance, by cutting public health and other preventative budgets); and third, that Labour will seek to achieve a cross-party consensus before the election in specific areas, such as social care and children in care, which may then be excluded from the zero budgeting process. Elsewhere, in an interview with the Mirror, Balls states that Labour will use private firms to run public services if it believes they will offer the taxpayer better value for money. The New Labour mantra of "whatever works" lives on. And rightly so. There is no reasonable objection to any of the above.

But the interview is also notable for what Balls doesn't say. With George Osborne due to announce spending plans for 2015-16 (the first post-election year) in next year's Spending Review, recent speculation has suggested that Balls, in an echo of Labour's 1997 strategy, could pledge to match them. In an interview with the Spectator, however, Harriet Harman poured cold water on this proposal, declaring that there was no chance of Labour "signing up to doing the very thing we think is hurting the economy".

Labour aides have since suggested that she was referring to this spending period, rather than the next one. But, offered the chance to settle the matter, Balls declined. And who can blame him? With Osborne's growth and borrowing forecasts changing so rapidly (and not for the better), few can say what situation Labour would inherit. For now, the priority remains to push for an economic strategy that would, at least, limit the damage.

Shadow chancellor Ed Balls said that Labour would have to "justify every penny". Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Air pollution: 5 steps to vanquishing an invisible killer

A new report looks at the economics of air pollution. 

110, 150, 520... These chilling statistics are the number of deaths attributable to particulate air pollution for the cities of Southampton, Nottingham and Birmingham in 2010 respectively. Or how about 40,000 - that is the total number of UK deaths per year that are attributable the combined effects of particulate matter (PM2.5) and Nitrogen Oxides (NOx).

This situation sucks, to say the very least. But while there are no dramatic images to stir up action, these deaths are preventable and we know their cause. Road traffic is the worst culprit. Traffic is responsible for 80 per cent of NOx on high pollution roads, with diesel engines contributing the bulk of the problem.

Now a new report by ResPublica has compiled a list of ways that city councils around the UK can help. The report argues that: “The onus is on cities to create plans that can meet the health and economic challenge within a short time-frame, and identify what they need from national government to do so.”

This is a diplomatic way of saying that current government action on the subject does not go far enough – and that cities must help prod them into gear. That includes poking holes in the government’s proposed plans for new “Clean Air Zones”.

Here are just five of the ways the report suggests letting the light in and the pollution out:

1. Clean up the draft Clean Air Zones framework

Last October, the government set out its draft plans for new Clean Air Zones in the UK’s five most polluted cities, Birmingham, Derby, Leeds, Nottingham and Southampton (excluding London - where other plans are afoot). These zones will charge “polluting” vehicles to enter and can be implemented with varying levels of intensity, with three options that include cars and one that does not.

But the report argues that there is still too much potential for polluters to play dirty with the rules. Car-charging zones must be mandatory for all cities that breach the current EU standards, the report argues (not just the suggested five). Otherwise national operators who own fleets of vehicles could simply relocate outdated buses or taxis to places where they don’t have to pay.  

Different vehicles should fall under the same rules, the report added. Otherwise, taking your car rather than the bus could suddenly seem like the cost-saving option.

2. Vouchers to vouch-safe the project’s success

The government is exploring a scrappage scheme for diesel cars, to help get the worst and oldest polluting vehicles off the road. But as the report points out, blanket scrappage could simply put a whole load of new fossil-fuel cars on the road.

Instead, ResPublica suggests using the revenue from the Clean Air Zone charges, plus hiked vehicle registration fees, to create “Pollution Reduction Vouchers”.

Low-income households with older cars, that would be liable to charging, could then use the vouchers to help secure alternative transport, buy a new and compliant car, or retrofit their existing vehicle with new technology.

3. Extend Vehicle Excise Duty

Vehicle Excise Duty is currently only tiered by how much CO2 pollution a car creates for the first year. After that it becomes a flat rate for all cars under £40,000. The report suggests changing this so that the most polluting vehicles for CO2, NOx and PM2.5 continue to pay higher rates throughout their life span.

For ClientEarth CEO James Thornton, changes to vehicle excise duty are key to moving people onto cleaner modes of transport: “We need a network of clean air zones to keep the most polluting diesel vehicles from the most polluted parts of our towns and cities and incentives such as a targeted scrappage scheme and changes to vehicle excise duty to move people onto cleaner modes of transport.”

4. Repurposed car parks

You would think city bosses would want less cars in the centre of town. But while less cars is good news for oxygen-breathers, it is bad news for city budgets reliant on parking charges. But using car parks to tap into new revenue from property development and joint ventures could help cities reverse this thinking.

5. Prioritise public awareness

Charge zones can be understandably unpopular. In 2008, a referendum in Manchester defeated the idea of congestion charging. So a big effort is needed to raise public awareness of the health crisis our roads have caused. Metro mayors should outline pollution plans in their manifestos, the report suggests. And cities can take advantage of their existing assets. For example in London there are plans to use electronics in the Underground to update travellers on the air pollution levels.

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Change is already in the air. Southampton has used money from the Local Sustainable Travel Fund to run a successful messaging campaign. And in 2011 Nottingham City Council became the first city to implement a Workplace Parking levy – a scheme which has raised £35.3m to help extend its tram system, upgrade the station and purchase electric buses.

But many more “air necessities” are needed before we can forget about pollution’s worry and its strife.  

 

India Bourke is an environment writer and editorial assistant at the New Statesman.