Balls sharpens his axe: where Labour would cut in 2015

Free schools, Police and Crime Commissioners, Titan prisons and army admirals are targeted for cuts.

There were two main aims of Ed Balls's speech on the economy today. The first was to reassure voters that while continuing to support stimulus now, Labour would pursue fiscal responsibility in office. While refusing to play George Osborne's game by saying whether he would stick to the coalition's 2015-16 spending plans ("when we do not know the economic circumstances two months ahead, let alone two years"), he emphasised that, before the election, Labour would adopt its own fiscal rules to eliminate the current deficit and reduce the national debt as share of GDP. Balls also signalled that, with growth finally returning, he would soon abandon his expensive pledge to introduce a temporary VAT cut (which Ed Miliband had such trouble defending in his infamous World At One interview) in favour of long-term capital investment. He said: 

Today, with growth prospects still very uncertain and interest rates too low to be of use, a temporary VAT cut now is still the right prescription before extra capital spending can come on stream – although any immediate tax cut which helps middle and lower income families is better than nothing. 

But over the coming year if, as we all hope, some kind of recovery does take hold, then the balance of advantage will shift from temporary tax cuts to long-term capital investment.

The second aim was to begin the task of forcing the left to accept that not only will Labour be unable to reverse most of the cuts imposed by the coalition, it will have to make its own. As Balls pointedly noted, "The next Labour government will have to plan on the basis of falling departmental spending."

The announcement that Labour would remove the winter fuel allowance from the wealthiest 5 per cent of pensioners is pretty small beer. While Ed Miliband's abandonment of universalism is politically significant (it opens the door to further benefit cuts), the move will save just £100m a year (less than half a per cent of the £207bn welfare bill), meaning that it barely qualifies as a rounding error. But Balls went on to outline, in greater detail than before, other, larger cuts and efficiency savings that a Labour government would seek to make. Since the shadow chancellor wants to give himself maximum flexibility in 2015, they were proposed in the form of questions (as was the winter fuel allowance cut) but, for now, they are the best guide we have to where Balls's axe would fall. Here's my summary:

- Not opening new free schools in areas with excess places. Balls derided "vanity schools projects" and suggested that Labour would not open new free schools in areas with a surplus of secondary school places. ("With primary school places in short supply in many parts of the country, and parents struggling to get their children into a local school, can it really be a priority to open more free schools in 2015 and 2016 in areas with excess secondary school places?")

- Scrapping Police and Crime Commissioners. ("When we are losing thousands of police officers and police staff, how have we ended up spending more on police commissioners than the old police authorities, with more elections currently timetabled for 2016?")

- Cancelling the new 2,000-place "Titan" prison recently proposed by Chris Grayling. ("Has the Ministry of Justice properly made the case for a major new 'Titan' prison, at a time when the prison population is falling?")

- Abolishing High Speed Two Limited, the company developing the new rail network. Balls suggested that this role could be performed more effectively by Network Rail ("Should we be spending millions on a separate company to deliver High Speed 2 when we already have Network Rail, which after all is responsible for rail infrastructure?")

- Cutting the number of army officers and admirals. ("Do we need more admirals than ships and more officers in our forces than our international counterparts at a time when frontline armed forces are under pressure?")

- Merging the four separate government motorist agencies. ("Do we really need four separate government agencies delivering services to motorists?")

- Combining management functions. in government departments, agencies, fire services and police forces. ("Does it really make sense to have separate costly management and bureaucracy for so many separate government departments, agencies, fire services and police forces - the same number as when this Government came into office - all with separate leadership structures and separate specialist teams?")

- Requiring industries to contribute more to the cost of regulation. ("Should industries pay a greater share of the costs of their regulators?")

The aim of these cuts and savings will be to free up funds for Labour's priorities (which Balls promised a "relentless focus" on): employment, housing, childcare, the NHS and social care. Based on his speech today, it is likely that Labour will go into the election promising to spend more than Tories in areas such as infrastructure (borrowing to invest), while giving itself the political cover to do so by adopting new fiscal rules, independently monitored by the OBR, and promising to control welfare spending (Miliband will announce his support for a cap on structural benefits, such as housing benefit, in his speech on welfare on Thursday). The defining political question is whether this will be enough to reassure a sceptical electorate, less than a third of whom believe Labour can be trusted to manage the nation's public finances, that it wouldn't "crash the car" all over again.

Ed Balls emphasised that Labour would have to plan "on the basis of falling departmental spending". Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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In the 1980s, I went to a rally where Labour Party speakers shared the stage with men in balaclavas

The links between the Labour left and Irish republicanism are worth investigating.

A spat between Jeremy Corbyn’s henchfolk and Conor McGinn, the MP for St Helens North, caught my ear the other evening. McGinn was a guest on BBC Radio 4’s Westminster Hour, and he obligingly revisited the brouhaha for the listeners at home. Apparently, following an interview in May, in which McGinn called for Corbyn to “reach out beyond his comfort zone”, he was first threatened obliquely with the sack, then asked for a retraction (which he refused to give) and finally learned – from someone in the whips’ office – that his party leader was considering phoning up McGinn’s father to whip the errant whipper-in into line. On the programme, McGinn said: “The modus operandi that he [Corbyn] and the people around him were trying to do [sic], involving my family, was to isolate and ostracise me from them and from the community I am very proud to come from – which is an Irish nationalist community in south Armagh.”

Needless to say, the Labour leader’s office has continued to deny any such thing, but while we may nurture some suspicions about his behaviour, McGinn was also indulging in a little airbrushing when he described south Armagh as an “Irish ­nationalist community”. In the most recent elections, Newry and Armagh returned three Sinn Fein members to the Northern Ireland Assembly (as against one Social Democratic and Labour Party member) and one Sinn Fein MP to Westminster. When I last looked, Sinn Fein was still a republican, rather than a nationalist, party – something that McGinn should only be too well aware of, as the paternal hand that was putatively to have been lain on him belongs to Pat McGinn, the former Sinn Fein mayor of Newry and Armagh.

According to the Irish News, a “close friend” of the McGinns poured this cold water on the mini-conflagration: “Anybody who knows the McGinn family knows that Pat is very proud of Conor and that they remain very close.” The friend went on to opine: “He [Pat McGinn] found the whole notion of Corbyn phoning him totally ridiculous – as if Pat is going to criticise his son to save Jeremy Corbyn’s face. They would laugh about it were it not so sinister.”

“Sinister” does seem the mot juste. McGinn, Jr grew up in Bessbrook during the Troubles. I visited the village in the early 1990s on assignment. The skies were full of the chattering of British army Chinooks, and there were fake road signs in the hedgerows bearing pictograms of rifles and captioned: “Sniper at work”. South Armagh had been known for years as “bandit country”. There were army watchtowers standing sentinel in the dinky, green fields and checkpoints everywhere, manned by some of the thousands of the troops who had been deployed to fight what was, in effect, a low-level counter-insurgency war. Nationalist community, my foot.

What lies beneath the Corbyn-McGinn spat is the queered problematics of the ­relationship between the far left wing of the Labour Party and physical-force Irish republicanism. I also recall, during the hunger strikes of the early 1980s, going to a “Smash the H-Blocks” rally in Kilburn, north London, at which Labour Party speakers shared the stage with representatives from Sinn Fein, some of whom wore balaclavas and dark glasses to evade the telephoto lenses of the Met’s anti-terrorist squad.

The shape-shifting relationship between the “political wing” of the IRA and the men with sniper rifles in the south Armagh bocage was always of the essence of the conflict, allowing both sides a convenient fiction around which to posture publicly and privately negotiate. In choosing to appear on platforms with people who might or might not be terrorists, Labour leftists also sprinkled a little of their stardust on themselves: the “stardust” being the implication that they, too, under the right circumstances, might be capable of violence in pursuit of their political ends.

On the far right of British politics, Her Majesty’s Government and its apparatus are referred to derisively as “state”. There were various attempts in the 1970s and 1980s by far-right groupuscules to link up with the Ulster Freedom Fighters and other loyalist paramilitary organisations in their battle against “state”. All foundered on the obvious incompetence of the fascists. The situation on the far left was different. The socialist credentials of Sinn Fein/IRA were too threadbare for genuine expressions of solidarity, but there was a sort of tacit confidence-and-supply arrangement between these factions. The Labour far left provided the republicans with the confidence that, should an appropriately radical government be elected to Westminster, “state” would withdraw from Northern Ireland. What the republicans did for the mainland militants was to cloak them in their penumbra of darkness: without needing to call down on themselves the armed might of “state”, they could imply that they were willing to take it on, should the opportunity arise.

I don’t for a second believe that Corbyn was summoning up these ghosts of the insurrectionary dead when he either did or did not threaten to phone McGinn, Sr. But his supporters need to ask themselves what they’re getting into. Their leader, if he was to have remained true to the positions that he has espoused over many years, should have refused to sit as privy counsellor upon assuming his party office, and refused all the other mummery associated with the monarchical “state”. That he didn’t do so was surely a strategic decision. Such a position would make him utterly unelectable.

The snipers may not be at work in south Armagh just now – but there are rifles out there that could yet be dug up. I wouldn’t be surprised if some in Sinn Fein knew where they are, but one thing’s for certain: Corbyn hasn’t got a clue, bloody or otherwise. 

Will Self is an author and journalist. His books include Umbrella, Shark, The Book of Dave and The Butt. He writes the Madness of Crowds and Real Meals columns for the New Statesman.

This article first appeared in the 25 August 2016 issue of the New Statesman, Cameron: the legacy of a loser