Public services or tax cuts?  Let’s be honest, you can’t have both


The Conservatives seek to frame pretty much every general election (with the exception of “Get Brexit Done”) as Tory tax cuts versus Labour spend.  

In 1997, Labour sought to avoid this by ‘shadowing’ Conservative expenditure plans, a trick that Rachel Reeves seems set to repeat in 2024. Hunt’s budget is likely to try to set up the same dilemma by offering tax cuts now, funded by unspecified cuts to public expenditure (meaning public services) somewhere down the line, on the assumption that Reeves – rather than he – will be left to implement them.

Reeves, however, is too savvy a politician to fall for such a trap.  While she will no doubt attack the Conservatives for “maxxing out the country’s credit cards”, expect a ‘no answer’ response to questions as to whether Labour will adopt the Conservatives’ tax and spending plans: “We need to look under the economic bonnet” and “kick the economy’s tyres”, accommodated by the best car mechanic hmmm-ing and chin-scratching.

Just as Labour is shadowing the Conservatives so, at this election, the Lib Dems are shadowing Labour. Both parties will rely on the message “we are not the Conservatives” to sweep them to power in their respective target seats, with voters happy to vote tactically to whichever is best placed to unseat the Conservatives locally.

It is a strategy of limited ambition for the Lib Dems, although in the aftermath of Jo Swinson’s disastrous overreaching claim to be running for Prime Minister it is thoroughly understandable. In the context of tomorrow’s budget, however, the party might be wise to go just a little further.

It has already been pointed out by others that the Conservatives’ strategy of offering tax cuts going into the election could fall at the first hurdle, given that the recent polling suggests the public are much more concerned by the state of public services than their taxes.  

The Conservatives are banking – perhaps not unreasonably – on there being a gap between what people say and what they do in the privacy of the ballot box.  They may well be right (and certainly they are lacking feasible alternatives).  

In those crucial red wall and Midlands seats where the cost of living crisis has hit hardest, it is a reasonable bet that, when push comes to shove, voters will take the cash they are offered and worry about the schools and hospitals later.

But the Conservative-Lib Dem battleground is markedly different. The soft Conservative voters that the Lib Dems are trying to win over are in leafy Godalming and Ash for example (local MP: Jeremy Hunt).  

Here, the squeezed middle classes are more concerned about the collapse of their kids’ schools, the lack of GP appointments and the cost of their parents’ care homes, than the immediate pressure for an extra tenner to get them through to pay day.  

An explicit commitment to put public services before tax cuts would not only give the Lib Dems a point of difference from Labour and the Conservatives, but one which would be carefully targeted at the audience that they need to win over.

What’s more, it is also likely to appeal to the Labour voters in the Con-Lib Dem marginals, who need a positive reason to vote tactically for the Lib Dems and might even welcome the message this would send to their party of first choice.

Since the Lib Dems renegaded on their tuition fees pledge, they have struggled to regain their former reputation for being ‘more honest than other politicians’.  

Now a message – “It’s public services or tax cuts.  The others are lying if they promise both. So we’ll be clear:  we chose the NHS” – might appeal as strongly as Ashdown’s “penny in the pound for education”.

Tomorrow’s budget is probably the last chance for the Conservatives to turn their fortunes around, while it’s just another potential banana skin for Labour to avoid.

For the Lib Dems, however, it might just offer an opportunity to develop an appealing and distinctive message, if only they have the courage to grasp it.

Picture credit: HM Treasury/Picture by Rory Arnold / No 10 Downing Street.

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Radix is the radical centre think tank. We welcome all contributions which promote system change, challenge established notions and re-imagine our societies. The views expressed here are those of the individual contributor and not necessarily shared by Radix.

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