My letter to George Osborne on the £70 billion cut risk to the NHS

Dear George,

Today Labour produced analysis showing that the Conservative Party’s spending plans for the next Parliament will mean £70 billion of cuts.

As I have just received your letter informing me that you will not now be attending Treasury Questions tomorrow, I am instead putting in writing some of my questions on your spending plans.

The Conservative Party has today failed to contest a single point of Labour’s analysis. You have instead chosen to dishonestly claim that your plans will lead to a total £30 billion of cuts when the real figure is more than double this.

Much of Labour’s analysis has been supported today by the independent Institute for Fiscal Studies. Speaking on BBC News, IFS Director Paul Johnson said:

“The reason that Ed Balls has been able to come up with a number like £70 billion-worth of cuts is because if you look at the last Autumn Statement, it does say the Government is looking for a £20-odd billion surplus by the end of the next Parliament. And the Conservatives have said they want £10 billion-worth of tax cuts. You put all of that together and it’s not very difficult to come to a world in which you are looking at £50-60-70 billion of spending cuts over that period.”

Paul Johnson, Director, Institute Fiscal Studies, BBC News, Tuesday 9 March 2015

You will have seen our step-by-step calculation to disprove your spending claims. I would now like to give you a chance to break your silence and confirm that your spending plans will mean £70 billion of cuts, by answering the following questions.

· Do you admit that your spending cuts extend over four years, not two?

· To meet your plans to have a £23 billion surplus by 2019-20, is it not the case that you will cut spending by more than the £30 billion you claim over the next Parliament?

· Do you admit that forecast rises in welfare spending mean deeper cuts to public services than your claimed £30 billion?

· Do you admit that rising capital spending means deeper cuts to day-to-day public services than your claimed £30 billion?

· If your unfunded tax cuts are brought in in 2019-20, House of Commons Library figures show they will cost £10 billion. Do you agree?

Generously assuming that the Conservative Party is able to meet your implausible claims to make £12 billion of welfare savings, your plans would still mean day-to-day spending on public services will be cut by £58 billion. Your claims to be able save £5 billion from preventing tax avoidance cannot be taken seriously given your woeful record in this area and the absence of new measures to do so.

If £58 billion of cuts were distributed evenly across all non-protected budgets (excluding schools, the NHS and ODA budgets) this would mean a cut of 35 per cent over four years for every non-protected department.

This would lead to the smallest police force since the late 1970s (the earliest available comparable data), the smallest army since Cromwell ruled Britain, and a third of older people in social care losing their entitlement to it.

These plans are so extreme and unprecedented that they are almost impossible to deliver and therefore risk you having to raise VAT again or breaking your pledge to ring-fence the NHS budget. International evidence which we have highlighted today suggests that cuts on the scale you are planning could lead to a real terms cut of £10 billion to the NHS by 2019/20.

You now owe the British people some honesty and clarity over your extreme and risky plans.

Will you proceed with £70 billion of cuts, which will have an unprecedented and deeply destructive impact on non-protected departments, or do you in fact plan to cut the NHS?

Perhaps you agree with Conservative MP Charles Walker, who when asked today whether he supported protecting the NHS budget, said, “I’m not sure that I do agree with it”. This is an increasingly popular view within the Conservative Party, with senior Tory Cabinet Ministers and backbenchers reportedly demanded that the NHS ring-fence be scrapped.

If you cannot answer, people will draw their own conclusions.

Yours sincerely,

Rt Hon Ed Balls MP
Shadow Chancellor

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Posted March 9th, 2015 by Ed

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