Monday 3 May 2010

Digby Jones's call for positivism

Around the time that the party leaders were preparing for the final TV debate, on the economy, Lord Digby Jones, a former head of the CBI and former minister in Gordon Brown's "big tent", spoke about the deficit. He made a plea that politicians and commentators should stop harping on about public sector cuts and concentrate on the other side of the equation, getting business going again. He is certainly not in favour of over-staffed "back offices" in the public service, but he is concerned about the current negative approach, which could mean the loss of many front-line jobs, like nurses and teachers.

The deficit has two components: public spending and the shortfall in taxes. Get businesses functioning and people earning again and the tax take will rise towards the (hopefully reduced) government spend. Lord Jones' pronouncements on BBC News will certainly resonate in Wales. It seems to me that we are already on or below the minimum front-line staffing needed to maintain a civilised state. Professors of business management (partly paid for out of public funds, be it noted) say that there should be more public service cuts because too high a proportion of economic activity is in the public sector in Wales. I have for a long time maintained that they are looking at the wrong side of the equation.

If there has been too much emphasis on cuts, it is largely the fault of these people, of Conservative-supporting media and even Lord Digby Jones's friends in business pressurising politicians to discuss how far and how deep we should cut.

Moreover, some of the cuts which have already been made have militated against recovery. The closing of local post offices and of local tax offices and the degrading of the Royal Mail have hit small businesses in Wales outside the cities. A draconian cut in job centres was only halted by Peter Hain's successor at the Department of Work and Pensions when it was obvious even to the government that we were in a deep recession. Shrinking the Probation Service means that released prisoners are slipping back into crime rather than being supervised into work.

I applaud Lord Digby Jones's approach, and hope that he will be back in government as part of a more forward-looking administration after the election.

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