The Tories should not let their caution on tax conceal the radicalism of their other policies

22 March 2008

James Forsyth reviews the week in politics

What a difference a poll lead makes. If Philip Hammond, the shadow chief secretary to the Treasury, had given an interview appearing to rule out tax cuts in a Conservative first term, when the Tories were behind in the polls or only marginally ahead, there would have been a full-scale revolt. To add fuel to the fire, Hammond talked about government storing up money in a ‘pot’ before giving it back — language which suggests that Hammond has forgotten whose money it is in the first place. But a YouGov poll showing the Tories with a 16-point lead which appeared on the same morning as the Hammond interview quelled any rebellion before it could get going.

Hammond’s comments to the Sunday Telegraph’s Melissa Kite were an overstatement of the Tory position. Key Cameroons are still offering reassurance that the party aspires to cut taxes in its first term even if it cannot pledge to do so.

The tax issue has not gone away, though. All Tories agree that the current tax take of 41.5 per cent of GDP — above that of Canada or Spain as well as America, Australia and Ireland — is too high. There is, however, a fundamental disagreement over what to do about this problem.

There will be no manifesto pledge to reduce the overall burden of taxation; the leadership has put too much stock into ruling that out to change tack now. If David Cameron and George Osborne were to reverse themselves on this, they would raise questions about the sincerity of every one of their positions. It would also be seen as a victory for their internal critics, a Clause Four moment in reverse. Gordon Brown would — the modernisers rightly say — have the opening he craves to depict Cameron and Osborne as ‘the same old Tories’, even as Tory ultras claimed that the public had finally twigged that funding doesn’t equal quality. It would be a brave man who would bet the Tories’ election prospects on the slogan ‘investment versus Tory cuts’ not working a third time for Labour. While a promise of tax cuts would not chime with the reassurance strategy that the Tories are currently pursuing on the economy.

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Henry Kaye

March 30th, 2008 10:06pm Report this comment

Whilst it's interesting to read your summary of the Conservative economic policies, i twould be nice to have some idea of what they proopose to do about the important social issues that confront us. I am talking about immigration particularly Moslem immigration, and the relentless assault on our freedoms that Labour have inflicted upon us now for 10 years. Also, what about the "Elephant in the Room" - the EU?

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