Weathering the Storm – A Liberal Approach to Austerity

Since 2010 a new word has become central to British politics: Austerity – a neat term adopted to explain the need to cut public expenditure and reduce the nation’s deficit.


Austerity has been accompanied by other terms to describe the need to save money: ‘balancing the books’, ‘tightening our belts’, and ‘efficiency savings’; terms that denote that these special times of financial crisis need to be tackled by special measures. Despite such terms of a storm that needs to be weathered, austerity is not something that will go away any time soon. It is not the elephant in the room – it is the room; a huge room all of us now live in together to save on rent. The financial markets that existed before the 2008 crash no longer exist to make large-scale public borrowing and spending (as was seen under Tony Blair) possible. Labour ignored these facts and during the recent general election they were punished for it. The question is now, how do the Liberal Democrats deal with this huge elephant-shaped interior space?

One way not to deal with it is to use the Tory approach of ‘slash-and-burn’ saving plans. While I understand that slashing a study on seagull colonies can save the tax-payer money – cutting the welfare bill will not. Take one of the most hotly debated issues during the election: welfare cuts. The Secretary of State for Work and Pensions, Ian Duncan Smith, has been told by the Treasury to identify £15 billion of welfare cuts; £3 billion more than was put forward by the Conservatives during the general election. With working tax credits and child tax credits now potentially in the firing line* this will hit lower-income families hard at a time when they need the most support. Such policies only look at the numbers and not the people behind those numbers. Punishing the poor and vulnerable is not the way to save the finances of the nation.

The need cut public spending (at least in the short and medium terms) is unfortunately a reality. There will be tough choices ahead but as a party the Lib Dems are in a position to champion the fair distribution of government cuts rather than automatically ring-fencing headline-grabbing departments while sawing off the branches of support that so many people rely on.

Rather than using such a meat-cleaver approach to cuts, the Liberal Democrats need to be the party of the scalpel. Strategic, or ‘smart’, spending would save the government money while providing resources to services that are needed by local communities. This will become increasingly difficult with the continuing reduction of funding for local councils (for which most of these services in turn rely on for their funding ) but as party with such strong grassroots and local political traditions the Lib Dems have an opportunity, if not a mandate, to champion such real issues for real people.

This doesn’t have to be huge and broad-sweeping reforms of national spending (I am not talking about disbanding the Royal Navy) but through strategically planning if a service needs to be scaled back then an equally strategic plan needs to be developed on what services(s) need to be bolstered to take its place. This would save already stretched public finances much needed resources compared to throwing money at initiatives to put out the fires caused by scaling back those services in the first place. Austerity is now the reality of politics but if we, as a party, can help develop those smart spending plans to help the most vulnerable we have the chance to stop those being worst hit from being hit any harder.




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