Leader: The new mood of conservative triumphalism is at odds with reality

The coalition’s record remains one of failure, even on its own terms.

The opening years of this parliament provided few opportunities for the self-congratulation that comes so naturally to the present generation of Conservative politicians. The economy barely grew, the NHS was left in chaos by Andrew Lansley’s reforms and the coalition government’s promise of a “new politics” was tainted by repeated scandals.

But in recent weeks a mood of triumphalism has taken hold in the Parliamentary Conservative Party and among its press supporters. In the final Prime Minister’s Questions before the summer recess, David Cameron declared: “The deficit is down, unemployment is falling, crime is down, welfare is capped and Abu Qatada is back in Jordan. Every day this country is getting stronger and he [Ed Miliband] is getting weaker.”

And yet, by any reasonable measure, the coalition’s record remains one of failure, even on its own terms. The economic recovery of which ministers boast is the slowest in more than 100 years, with GDP nearly 4 per cent below its pre-recession peak. In the US, by contrast, where the Obama administration maintained fiscal stimulus, the economy is 3.2 per cent larger than in 2007 after growth four times greater than that of the UK. And rather than rebalancing the economy away from debt-driven consumption and towards investment and exports, as was promised and was desirable in 2010, George Osborne appears intent on creating another housing bubble through his Help to Buy scheme, which will reflate demand without addressing the problem of supply.

The headline fall in unemployment, which remains unacceptably high at 2.51 million (7.8 per cent), masks the sharp rise in so-called underemployment, with a record 1.45 million people in part-time jobs because they are unable to work full-time. To compound this, long-term unemployment has reached a 17-year high of 915,000 and youth unemployment is at 959,000 (20.9 per cent). That total joblessness has not risen to the heights experienced in the 1980s owes more to workers’ willingness to price themselves into employment (real wages have fallen by a remarkable 9 per cent) than the success of the government’s strategy. To voters enduring the greatest squeeze in living standards in recent history, ministers offer scapegoats – “welfare dependants”, “health tourists”, “troubled families”. In the meantime, Britain’s core problems, such as its economic short-termism, its lack of social mobility and its extreme income inequality, remain largely unaddressed.

As global competition intensifies, the UK needs a government that, as well as encouraging enterprise and enabling small businesses to flourish, will be prepared to use the state innovatively to promote balanced growth, that is capable of maintaining old international alliances and forging new ones, and that can revive a sense of national purpose of a kind that, for now, is largely absent.

David Cameron greets Olympic volunteers whilst on a visit to the former Olympic site on July 19, 2013 in London. Photograph: Getty Images.

This article first appeared in the 29 July 2013 issue of the New Statesman, Summer Double Issue

Photo: Getty
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The big problem for the NHS? Local government cuts

Even a U-Turn on planned cuts to the service itself will still leave the NHS under heavy pressure. 

38Degrees has uncovered a series of grisly plans for the NHS over the coming years. Among the highlights: severe cuts to frontline services at the Midland Metropolitan Hospital, including but limited to the closure of its Accident and Emergency department. Elsewhere, one of three hospitals in Leicester, Leicestershire and Rutland are to be shuttered, while there will be cuts to acute services in Suffolk and North East Essex.

These cuts come despite an additional £8bn annual cash injection into the NHS, characterised as the bare minimum needed by Simon Stevens, the head of NHS England.

The cuts are outlined in draft sustainability and transformation plans (STP) that will be approved in October before kicking off a period of wider consultation.

The problem for the NHS is twofold: although its funding remains ringfenced, healthcare inflation means that in reality, the health service requires above-inflation increases to stand still. But the second, bigger problem aren’t cuts to the NHS but to the rest of government spending, particularly local government cuts.

That has seen more pressure on hospital beds as outpatients who require further non-emergency care have nowhere to go, increasing lifestyle problems as cash-strapped councils either close or increase prices at subsidised local authority gyms, build on green space to make the best out of Britain’s booming property market, and cut other corners to manage the growing backlog of devolved cuts.

All of which means even a bigger supply of cash for the NHS than the £8bn promised at the last election – even the bonanza pledged by Vote Leave in the referendum, in fact – will still find itself disappearing down the cracks left by cuts elsewhere. 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.