Conservative Future

Whatever happened to the tough decisions?  It could hardly be a tough decision to trim universal benefits for the well-off so spending in universities could be maintained and kids could still get a reasonably priced education. But it was clearly too tough for the Government. As a result, even if they actually deliver on all their promises to cut spending and stick with it through to 2015, the state will have shrunk only to the size it was in Blair's first administration. Radical, it is not. The reality is in fact that this squeeze is the same old stuff we had in 1976, in 1982 and in 1993, in other words on each of the previous occasions the government finances tipped over the edge, albeit delivered with more professional spin.  Simon Ward, an economist with  Henderson , the fund management group, made that point succinctly enough yesterday afternoon. He noted that “total managed expenditure”, the ultimate measure of spending, would decline by 3.3% in real terms by 2014-1...

Education Secretary Michael Gove has told MPs that real terms school spending will increase over the Spending Review period. Mr Gove responded to an urgent question from shadow education secretary Andy Burnham on the government's £7bn "fairness premium" package, announced last week by Deputy Prime Minister Nick Clegg. "This money will be invested in accelerating social mobility," he told MPs.  The package announced by Mr Clegg will include 15 hours a week of free nursery education for the poorest two-year-olds, at a cost of £300 million a year by 2014/15, and a "pupil premium" with funds handed to schools to help pupils eligible for free school meals - a measure of poverty - which will eventually be worth £2.5bn per year.  A "student premium" to help the poorest teenagers to go to university will also be set up, at a cost of at least £150m per year by the end of the Spending Review period.  Mr Gove said that the government had "inherite...

Leaders of 35 of the UK's biggest companies, including BT and Marks and Spencer, have expressed their support for the government's planned spending cuts. Writing to the Daily Telegraph, the bosses said there was no reason to believe Chancellor George Osborne's approach would undermine any recovery. They write it would be a "mistake" for Mr. Osborne to water down his programme for reducing the budget deficit in Wednesday's Spending Review. They said: "Addressing the debt problem in a decisive way will improve business and consumer confidence.Reducing the deficit more slowly would mean additional borrowing every year, higher national debt, and therefore higher spending on interest payments. The private sector should be more than capable of generating additional jobs to replace those lost in the public sector." In Wednesday's Spending Review, Mr Osborne will outline which areas of Whitehall's budget will be hit the hardest, as the govern...

Hit squads of inspectors are to be sent to areas where problems with benefit cheats are rife, the chancellor George Osborne has said. Mr Osborne compared welfare cheats to muggers robbing taxpayers of their hard-earned money. He also warned that repeat offenders could have their benefits cut off for up to four years. Benefit and tax credit fraud costs the taxpayer an estimated £1.5bn a year. The government is planning to reduce the annual welfare bill by a further £4bn, on top of an £11bn cut made in June. Details of how the savings are to be made are to come in next week's Spending Review. The new anti-fraud drive will use hi-tech data-tracking techniques and another 200 inspectors are to be recruited to a new investigation service. Welfare reform minister Lord Freud said minor offenders would face instant £50 fines and offenders caught three times could face a three-year benefit ban. He also said investigators would seek to seize more assets from benefits cheats.

Hillary Clinton has said that plans to cut the Ministry of Defence budget by 10% are of concern. The views expressed by Washington came as Britain's top military leaders launched a last ditch attempt to persuade David Cameron to scale down the cuts.  In an interview with BBC Parliament's The Record Europe in Brussels, Clinton said. "The reason it concerns me is because I think we do have to have an alliance where there is a commitment to the common defence. Nato has been the most successful alliance for defensive purposes in the history of the world I guess, but it has to be maintained. Now, each country has to be able to make its appropriate contributions." Robert Gates, who was in Brussels for a meeting of NATO defence ministers, voiced similar concerns. "My worry is that the more our allies cut their capabilities, the more people will look to the United States to cover whatever gaps are created. At a time when we are facing stringencies of our own, that's...