Put out more flags! Ring the bells and light the beacons, the austerity war against the people is over! The prime minister said: “The British people need to know the end is in sight. And our message to them must be: we get it.”
But “getting it” doesn’t mean doing it: announcing it may be all that matters. Consider how easily her promised £20bn a year for the NHS has taken the ongoing crisis in hospitals and GP surgeries off the front pages, without a penny spent and winter approaching. Paul Johnson of the Institute for Fiscal Studies said today that, on top of this, £20bn extra by the end of the parliament would only stop further cuts, with the funds consumed by rising numbers of older people. That’s a sobering thought – such a large sum just to stand still.
Look around at the wreckage of eight years of cuts, and the enormity of what they have done is daunting. This is the real deficit, the uncounted one, yet far more damaging than the one on the Treasury books, which is now below its peacetime average. The public sees it in potholes, dilapidated parks, the rarity of police, closing post offices and advice centres, vanishing public officials in railway stations and everywhere else. The collapse of high streets may be partly due to online buying, but as people have less to spend, those shuttered shops become the face of austerity and neighbourhood decline.
How long would it take to repair all this? The IFS says “historically unprecedented” cuts have brought public spending back to below its pre-crash level. Yet there are still monstrous extra cuts scheduled for the next three years: harshest is the £12bn still to fall on benefits, as universal credit, the benefit cap and freezes knock flat already hard-up low-paid families, draining spending from poorer places, with median earnings still 3% below 2008. Expect no cancellation of that in the budget.
Brexit uncertainty – crash or slow decline – makes any dip in austerity unlikely. How will the Treasury respond to another shock? As Keynesians, investing in public spending to avert recession, or like George Osborne, cutting deeper into the headwinds, maximising harm? With £500m a week of GDP already lost by Brexit, Whitehall is hiring 9,000 more civil servants, Defra is bringing in 1,200 more staff and Border Force is also swelling – pointless spending eating up funds that could ease austerity.
Theresa May’s one vital anti-austerity announcement was ending the cap on councils’ borrowing to invest in house building, reversing Osbornomics’ craziest policy. Council housing is an asset that, through rents, yields a profit over the years. New towns made money, recouping investment: Labour’s great failure was bowing to the nimbyism that blocked their six promised new eco-towns. It matters not a jot how much is added to the national debt when it adds capital with a long mortgage: the government needs a clearer divide between good national debt arising from investment, and bad debt from increased current spending that only swells through fear of taxing enough to cover it.
Now, the sky is the limit for councils to invest: my own council, Camden, has plentiful shovel-ready housing plans awaiting this freedom. But here’s one crucial caveat: the right to buy has to stop. What’s the point of Camden building, only to sell off homes at up to a 70% discount before the investment is repaid? Lenders won’t shell out for assets that vanish off the books. If the government wants to help tenants buy, then use other schemes in the private sector, without depleting housing that a million people are waiting for, destined to for ever rent privately, paid for by sky-rocketing housing benefit.
What’s promised at conference all too often stays at conference: May will barely ease austerity, if at all – but her words raise dangerous expectations. What’s more, she opens the buzzing box on difficult questions. Surveying the tree stumps of the public sector battlefield, where would you start unravelling austerity? Everywhere you look, outstretched hands beg for their cause.
Schools have lost £2bn in three years, with 66,000 more pupils, so forget the education secretary’s strutting conference promise of “world-class education for everyone”. What of the arts and music vanished from schools? But then should schools even come first when early years teaching does more to set children on the path: rebuild vanishing Sure Start first. Social care for old and disabled people is collapsing, as is health visiting for new babies. What of prisons’ exploding violence? (No, just put fewer in jail and use savings for community sentences). Meanwhile, councils go bankrupt, and number of children in care soars for lack of social workers. Reopen libraries and swimming pools? Bring back the education maintenance allowance? How do we solve abysmal productivity, when apprenticeships fell by 28%?
Once people ponder what comes first, Labour will find itself equally torn by urgent pleas to repair the damage. Would free student fees really still come top? With time to think before its next manifesto, is it right to guarantee old people’s triple-locked pensions while young families fall behind? If Bevan was right and “the language of priorities is the religion of socialism”, easing up on austerity will require extremely painful socialist decisions. But who comes first for generosity is a problem unlikely to confront this government, whose austerity would go on and on through the next decade, if they got the chance.
• Polly Toynbee is a Guardian columnist
