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Thursday, May 25, 2017

Why economic competence is the loser in this election

Ever since I have been involved in national politics, the Liberal Democrats and most of the other mainstream parties have endeavoured to produce a costed manifesto so that, if they win they are able to deliver on the promises they made during the campaign.

There have been times when this has been a hit-and-miss exercise, with the Liberal Democrats' tuition fees pledge being one of the more recent examples, but at the end of the day government is about making choices and I suspect that the party's Ministers could have insisted on freezing fees at least if they had felt strongly enough about it.

Of course broken promises are not always related to finance. After all Labour broke two manifesto promises when they introduced tuition fees and then trebled them despite the fact that they had a majority, something the Liberal Democrats did not have.

This General Election campaign appears to have changed that pattern. Not only have Labour produced a document which fails to cost key elements such as their renationalisation programme, but some of their other costings are tendentious at best.

The Tories have gone one better, they have failed to provide proper costings at all. And where they have provided costings they are disputed. It is almost as if they didn't care, as if they think they are going to be re-elected irrespective of what they promise.

The latest controversy is over the Tory pledge to provide free breakfasts for primary school pupils, a policy they resisted for years in Wales. According to the Guardian, Conservative promises to plug the hole in school budgets could be ruined by this pledge, after researchers found the policy would cost far more than the party claimed:

Figures compiled by the Education Datalab thinktank showed that even if only one in five of England’s 3.6 million primary school pupils ate just 25p worth of food, the costs for the daily breakfast clubs would cost £100m a year more than the Conservatives’ estimate.

“We think they are under-costing free breakfasts in primary schools by something like a five-fold factor. They say its going to cost £60m but we think it’s going to cost something over £200m to £400m,” said Rebecca Allen, the director of Education Datalab.

The free breakfast offer in the Conservative manifesto was to replace giving free lunches to all state school pupils up until the age of seven, with the savings used to plug the looming black hole in England’s school finances.

The analysis found the costs would far exceed the Conservatives’ estimate of £60m a year, with a 20% takeup costing more than £170m once staffing costs for the breakfast clubs – held an hour before the start of the formal school day – were taken into account.

“If breakfast clubs in schools act as a proper childcare substitute, we would presume that in the long run parents would switch from their existing provision of childminders and commercial providers into free breakfast clubs – and therefore we think takeup would be substantially in excess of 20%,” Allen said.

The researchers also found that if the offer proved more popular it could potentially wipe out savings from scrapping the free lunches.

Having abandoned the UK economy by condemning it to a hard Brexit, it seems that both Labour and the Tories have given up on economic competence as well.
On tuition fees, credit should be given to Vince Cable and team for making the sums in the 2010 manifesto add up after party conference had (narrowly) voted for abolition in the face of contrary advice from "the top table". I believe that the policy could have been implemented, but would have meant a great reduction in the number of university students which the state supported. (Some of us think this would be a good thing.) So the student loans scheme may be rightly unpopular with students, but more popular with parents. This is a dilemma which would face Mr Corbyn if he came to power and he clearly has not costed abolition if he believes he can still send 60% of children to academic institutions.

They are fighting for power. They are not bothered about responsibility and all that goes with it. They will sort out the mess as we sink into banana republic status.
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