Ben Duncan - 2010 Budget
24 March 2010
In this comment piece, Cllr Ben Duncan (Brighton and Hove) argues that when markets fail, you just can’t cut your way out of a recession:
Today is budget day - and perhaps this Government's last chance to get the economy back on track.
We've heard, over and over, that this won't be a traditional give-away budget - but that's exactly what we need.
Not in the sense of cutting taxes, either on the ‘bad' stuff like cigarettes and alcohol, or the ‘good' stuff, like wages and pensions - but a budget that recognises we shouldn't rush to pay off our national debt and should, instead, focus on securing - and creating - jobs, and improving pay and conditions across the public sector.
We need to remember that when markets fail, the government needs to step in and get the economy working again. The truth is, as we learnt in the 1930s - you just can't cut your way out of a recession.
If people are in work, they're spending money and they are paying taxes - and that's what makes the economy go round.
The UK has had a large public debt for much of our history. We fought World War 2 with a large debt. We created the NHS with a large debt. Lots of countries keep themselves prosperous despite high levels of public debt.
Public spending cuts would harm the economy. It would impact on jobs - and hit the poorest hardest. That's just not fair.
We need to see it made easier to create jobs in the private sector too: and perhaps the best way to do that is to scrap much of the red-tape that's holding small businesses back.
We must roll VAT, National Insurance and Income Tax into one, both to cut prices and balance some of the inflationary pressure of carrying large amounts of national debt, but also to cut the form-filling burden on small businesses by more than a third at a stroke.
We'll see what Gord-help-us Brown and Alistair Darling come up with,but I'm not holding my breath.
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