Ed Miliband’s speech on reducing the deficit has attracted a fair bit of criticism for not telling us very much that’s new. It was supposed to be a Big Speech, and Big Speech normally means Big Announcement, but there wasn’t one.
There wasn’t even really any bigger attempt to tell us what Labour would do after the General Election. The Labour leader spent a fair chunk of the question-and-answer session afterwards telling the audience that he had been ‘clear’, which is what politicians end up having to say when they haven’t been clear, often deliberately.
But it’s unfair to say that this was a useless speech as it did articulate better than previously the Labour leader’s basic vision for the economy. It started with Miliband saying ‘my speech today is about the deficit’, just so it was clear that he wasn’t going to forget it this time around. He managed to articulate with greater confidence before what Labour sees as the difference between good and bad borrowing. Good borrowing is for capital projects, with Miliband saying ‘productive investment in our infrastructure should be seen differently from day-to-day spending because it often has a greater economic return’.
But bad borrowing finances revenue spending: ‘And we will also have a surplus on the current budget so that revenues more than cover day-to-day spending, again as soon as possible in the next Parliament’. Of course, this is a sleight of hand as it means Labour can claim it isn’t borrowing more when it is indeed borrowing a great deal more, but there was a stage where the party wasn’t even that confident of making the case for borrowing to fund capital spending.
The Labour leader also clearly sees one of the Tories’ favourite pledges as one of the best ones to exploit: tax cuts. He told the audience ‘their priority is unfunded tax cuts, my priority is to save our National Health Service’.
That vision remains a sketch rather than a blueprint, though, as Miliband didn’t tell us the following things:
- The detail of the spending cuts, which he won’t fully set out until he is in government. He said: ‘Of course, the reality is that much of the detailed work about spending reductions can only take place when we have the full resources of government at our disposal.’
- The full detail of tax rises, with Miliband saying his party would ‘set out our tax plans at the election’.
- When the deficit would be eliminated (though Miliband doesn’t want to set a date because ‘the easy thing is for politicians to claim great certainty when there is not).
- Where Labour will put up ring fences on spending, which it won’t do until the manifesto.
When asked whether all the party leaders were failing to be honest with the public about the extent of the cuts to come under any plan, Miliband naturally said he didn’t accept that characterisation. He kept talking about more detail before the election, and even more once Labour is in the departments.
So one thing is clear: Ed feels that now is not the time to be clear about cuts. His only advantage is that the other party leaders agree. His disadvantage is that the polls show that voters are less inclined to trust his judgement on these matters than they are David Cameron’s (or indeed Nigel Farage’s).
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