Fraser Nelson

Bacon sandwiches and 50p tax at Cameron’s presser

Bacon sandwiches and 50p tax at Cameron's presser
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There were cold bacon sandwiches on offer at Cameron’s press conference this morning, arranged for 9.15am to get it in before Gordon Brown’s presser with the Iraqi PM (no shoes thrown at Brown), and to time it with the passing of the Coldstream Guards band playing outside. Well, the latter was perhaps a coincidence. But it did make it all seem like one of those IDS-era party conferences where they had Nimrod playing in the background. Anyway, my highlights:

1) SPENDING

"We’ve said for some time ‘you’re spending too much in 2009, you’re spending too much in 2010’." It’s hilarious hearing Cameron claim to have been some kind of prophet in the wilderness, wailing about cuts. In Cheltenham, he made it sound all historic: “We said they should reduce their spending plans back in 2008.” Way back in 2008, eh? What he really meant was “mid-November”. That, of course, sounds a lot less impressive. I’m sure part of Cameron does want to take risks. But I suspect his instinct kicks in, saying “we lost three elections by arguing outside the mainstream.”

2) WILL TORY MPs HAVE TO QUIT WHEN EXPENSES ARE MADE PUBLIC?

“I hear the same stories that you do. Whether they turn out to be true, we’ll have to see.” Interesting that Cameron makes no attempt to deny that several of his MPs could have been caught out when expenses are released. He was asked about by-elections, and all sorts. He said he has no info (I wonder if the Tory whips do) but it’s a reminder that, come June, several chaps in blue rosettes will be in the dock with a lot worse than 88p bathplugs.

3) BEING HATED

“Q: What does it mean for you that it’s no more cuddly Cameron, it’s going to have to be nasty Cameron.” A: “I think there’s a third way.” Bless. There isn’t. It’s his job to make 7% cuts across all spending departments over three years (average 2.3% a year) – such a draconian cutback has never been done before. There are going to be teachers marching down Whitehall burning effigies dressed in Bullingdon garb. I sympathise: it’s a horrible thought. But Cameron should steel himself for it. There’s no such thing as a popular hatchet man.

4) HEALTH SPENDING

“The commitment for the NHS is very specific. The idea that you can have anything less than a real terms increase is not realistic.” Thought: what dirt does Lansley have on Cameron? What dirt does the NHS Confederation have on both of them? The NHS has had the most money spent on it, with the least results. It stands to reason that its budget could be cut, with the last pain. If health is protected, then all other departments will have to suffer something like a 10% cut over three years, averaging around 3.2% a year.

5) REFORM

“If you’re going to get public spending under control, you’ve got to reform the unreformed public services.” I precisely agree. Which is why the ‘no reform’ approach to the NHS needs revisiting. As does the ‘no cuts’ pledge.

6) WELFARE

“Sorting out that welfarism has got to be a key part of not just getting the budget under control but sorting out the broken society, because a life spent on the sofa is no life at all” I quite agree – but he should be careful on the first point. Welfare reform is highly unlikely to get the DWP budget under control – done properly, it costs. You’re saving souls, not cash. Even the Wisconsin model didn’t lead to much of a sav

ing, at least in the first few years, as you have to assess the “sick” properly, etc.

7) SWINE FLU

“This is an issue where politicians should be working together”. I disagree. There is no practical basis, it’s not as if we’re sending a divided message to a foreign enemy. The Tory role is to scrutinise the government’s programme and hound them for every failing. Cameron is sometimes a little too quick to consensus, as he was on the banking bailouts. In wartime, unity has its points. But there is a reason that Churchill refused to rebuild the bombed Commons chamber in any other way: he wanted a fiercely adversarial system. Works for me.

8) INTERNATIONAL DEVELOPMENT

“On overseas aid, this issue has been plucked out of politics and all parties support it.” Only because the Tories caved into the agenda of the NGO lobby to devote 0.7% GDP spent on international aid. I’m against this, for four reasons. It saps people’s willingness to give direct to charity if they think their tax claim contains a component of charity (by 2013 it will be an average of £400 a taxpayer). Also because the 0.7% of GDP target is what the state donates - you should look at what the people of a country give. Should it really be the state’s role to forcibly collect charitable donations through the tax system? Thirdly, government does aid very badly, shipping £millions to places like China, whose millionaires are keeping our Rolls Royce factories going. Finally, too much money is intercepted by the sprawling, high-cost NGOs who ensure that much of it remains in London.

9) WILL THE 50p TAX RAISE ANY REVENUE?

“I have looked at the reports that mention it is a very difficult calculation and where we are on the Laffer curve. I’m pretty convinced it will raise a lot less than the government tell us. It is difficult to be certain that it will raise less money. It is difficult to base plans on that.” This is vague, and that suits me – because the 50p tax could cost Cameron billions. I hope he doesn’t box himself into a commitment to keep it. And he shouldn’t use words like Laffer – while accurate shorthand, it makes it sound like some obscure 1970s theory. The idea that 'high tax rates = lower tax yields' is  basic common sense, which can be traced it back to the book of Deuteronomy if you want to go back far enough.

10) WORKING WITH NICK CLEGG

 “I thought yesterday [the Gurkha deal] was just a good example of being constructive and building a trust that we can work together”. It’s easy to forget how the prospect of a LibDem coalition haunted Blair even when he was 40 points ahead in the polls. It’s evidently haunting Cameron too. A major question facing the Tories right now is whether they go for a large majority (ie, safety first and tax the rich), or a large mandate (ie, hard truths and agenda for change). The prospect of Clegg in the Cabinet is always enough to make the Tories err on the side of caution.

Written byFraser Nelson

Fraser Nelson is the editor of The Spectator. He is also a columnist with The Daily Telegraph, a member of the advisory board of the Centre for Social Justice and the Centre for Policy Studies.

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