Vince Cable: ‘‘Poverty as we know it will be largely gone. The vast majority will constitute a global middle class’’

The Secretary of State for Business answers the NS Centenary Questionnaire.

What is the most important invention of the past hundred years?

Television: for me, as a platform to communicate; and for billions, a window on the world.

What is the most important scientific discovery of the past hundred years?

DNA research has opened up immeasurable life-enhancing medical applications and a better understanding of life.

What is the greatest sporting event of the past 100 years?

A quirky, personal choice: the 1955 FA Cup semi-final, York City v Newcastle United. It was the biggest, most memorable sporting event of my upbringing. And a reminder of days when David could challenge Goliath (and draw 1-1, after a goal scored by a milkman called Bottom).

Which book or film has had the greatest impact on you?

David Lean’s Great Expectations. The opening scenes haunted me for years, but made me addicted to the power of the cinema.

Which piece of music?

Beethoven’s Piano Concerto No 1 – a reminder of the musical family that my late wife, Olympia, created and of the education she gave me in the world’s great music. Beethoven was her idol.

Which work of art?

The entire temples of Khajuraho. I once travelled a thousand miles across India to see this masterpiece of temple art and architecture, created five centuries before the European Renaissance.

Who is the most influential or significant politician of the past hundred years?

There is little to be said for the monsters who dominated the politics of the 20th century – Stalin, Mao and Hitler – or for those who served them. One remarkable exception is Deng Xiaoping, whose economic reforms, post-Mao, unleashed the most successful era of poverty reduction and material advance in history.

And sportsperson?

Muhammad Ali. He demonstrated great physical and moral courage, as well as great skill, in the most punishing and demanding of sports.

And business person?

Ratan Tata (and his predecessor J R D Tata). One of Britain’s leading manufacturers and an embodiment of the long-term strategic thinking that lies behind a dominant business of the coming Asian century. He has maintained a reputation for ethical and honest business in a highly amoral environment.

And author?

For non-fiction, and as an economist, I am torn between John Maynard Keynes and Amartya Sen. For fiction, the greatest modern novelist never to win a Nobel prize for literature –Graham Greene.

And philanthropist?

The Rowntrees. In the city where I grew up, they created a model of responsible capitalism that influenced me greatly and which lives on. The work of their foundation on poverty is as relevant as ever.

What is your favourite quotation?

Mahatma Gandhi: “Western civilisation? It would be a good thing.” A gentle reminder that many people outside Europe do not totally share western conceit.

What is the most significant change to our lives you envisage over the next 100 years?

The most significant change in our lives will be the impact of ageing and growing life expectancy, with the dependent frail and elderly becoming a very large social group, not just in Europe, but also in countries such as China.

What is your greatest concern about the future?

My greatest concern is that the self-discipline of deterrence will no longer stop the use of nuclear weapons in a future conflict (or conflicts). And this is why we have to scale down our nuclear deterrent and work for a nuclear-free world.

In your own field of work, what will be the most dramatic development?

For the first time in history, poverty as we know it today will be largely gone. The vast majority of humanity, who will live in Asia, Africa and Latin America, will constitute a “global middle class”.

What is the most important priority for the future well-being of both people and our planet?

Making a transition from governance built around nation states to one with a strong system of global rules to deal with shared problems such as climate change and lethal weapons proliferation.

Vince Cable is Secretary of State for Business, Innovation and Skills, and MP for Twickenham

Vince Cable. Artwork by Ellie Foreman-Peck

This article first appeared in the 13 November 2013 issue of the New Statesman, The New Exodus

Photo: Getty Images
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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR