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22 December 2013

Cable warns that cuts are having a “severe“ effect on public services

The Business Secretary contradicts Cameron's claim that you can do "more with less" and says "some very good services are being seriously affected".

By George Eaton

David Cameron and George Osborne have recently argued that austerity has proved that the state can do “more with less”, with the quality of public services unaffected by the cuts. But on The Andrew Marr Show this morning, Vince Cable directly contradicted this claim. He warned that the pressure on services from the cuts was becoming “severe” and that “some very good services are now being seriously affected”. He added: “I am concerned about the social fabric”.

Cable was replying to a question on the IFS’s warning that £12bn of further tax rises or welfare cuts will be required merely to maintain cuts at their current pace. In response, he reaffirmed the Lib Dems’ commitment to a mansion tax (replying “yes” when asked if it was a “red line”) but refused to comment on whether income tax would need to rise. With amusing understatement, he said that the abolition of the 50p tax rate had “not been a great political success” but that he was not in favour of restoring it. For Labour and the Lib Dems, in particular, the question of how they will plug the fiscal gap is going to become more insistent as the election draws closer (George Osborne has said that he would reduce welfare spending by “billions” in order to limit cuts to departments).

Elsewhere in the interview, Cable warned that the government “needed to look again” at Help to Buy and the “house price boom” it was fuelling, denounced “ridiculously tight” visa restrictions and compared the current panic over immigration to “Enoch Powell and ‘rivers of blood'”. He said: “The responsibility of politicians in this situation when people are getting anxious is to try to reassure them and give them facts and not panic and resort to populist measures that do harm.” It was one of those occasions when it is easy to forget that Cable is a serving member of the government.

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