Taking stock
21 October 2010Nick Seddon, deputy director of the thinktank Reform
Nick Seddon, deputy director of thinktank Reform, said there were no big surprises in the government's overall objective to get rid of the deficit.
"Frankly it's clap, clap when it comes to addressing the deficit which is the right thing to do but the problem that I have is that too many budgets are being ringfenced, which is a political rather than an economic decision - you see so much waste revealed in many departments like healthcare and they are panicking to protect it," he said.
Seddon said that the chancellor George Osborne was right to highlight public service reform but warned there may be political and public fallout from deep cuts to the Department for Communities and Local Government, the police and local government budgets. Seddon believed that the decision to ringfence pensions was "completely wrong", because public sector pensions were "a ticking time bomb", but disagreed that a winter of discontent lay ahead. "I am not sure if we are going to see a winter of discontent style backlash from the unions or rioting in the streets as in France at the raising of the pension age," he said.
Seddon is in favour of wider application of time limits to benefits and allowances. "Osborne talked about the Employment Support Allowance being time limited and there are obvious benefits in terms of saving money and focusing minds but the ESA is relatively small. [In the US, President] Clinton time limited benefits in the 1990s very effectively."
Seddon is a fan of Osborne's review. "I think it's the best CSR we have seen in a long time and speaks of fiscal responsibility which is what Labour said and did in their first term but then went on to allow a boom in spending," he said.
However, Seddon felt the review offered little support for Cameron's Big Society idea. He pointed out that £83bn in public spending cuts could hit voluntary bodies hard, because those bodies were increasingly dependent on local government contracts that had been "slashed", and on the Cabinet Office's Office for Civil Society, which has a budget of £470m. "There is an awful gap between £83bn and £470m," he said.
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