Wednesday 29 September 2010

Fox raids Treasury

At last the first shots have been fired in the new Battle for Britain: the spending cuts (that is apart from the Police who are just threatening an increase in crime as they normally do).  No surprise that it was Liam Fox who fired the first salvo - a letter to the PM claiming that the MoD needs to be made a special case. They cannot be expected to make cuts, despite being given one of the less harsh savings targets of 10 -20% instead of 25-40% for most departments in the spending review.  The same Dr Fox that barely practised as a Doctor is in danger of having his Napoleonic ambitions thwarted too. Meanwhile Generation Ed have given strong hints that the UK can no longer pretend to be a military power and that we must work through the United Nations; if only PM Blair had stuck to this mantra on Iraq he would have escaped the odium that has been heaped on him.

I always find the MoD pitch for their budget a bit rich. They display all the procurement savvy and loyalty  of premiership footballers. They are as territorial in their defence of separate services and divisions as they once were of the empire. They have had a 90% increase in expenditure during the Blair/Brown years with little evidence that they have improved either procurement or the security of the UK.  A modest defence programme is vital, particularly if deployed within an international framework and for home security, but it can no longer be realistic to spend 2.5% of our GDP on defence. This is only exceeded by the USA and Russia of the developed countries. Most European countries including Germany, Spain, Sweden, Norway, Italy and Denmark, as well as Canada and Japan, are spending between 1.0% - 1.5% of their GDP on defence.  Only France, at 2.3% emulates the UK's obsession with hanging on to the dream of influence through armed force. Even if the UK reduced its defence expenditure by 10%, it would still have the highest defence spending in Europe.

The future reputation and respect for the UK will not be achieved by defence expenditure, we are not in the same league as the United States, China or Russia. It will be measured by our capacity for innovation, freedom of speech and human rights, greater social cohesion, ethical investment and global altruism.  And these activities cannot be defended by aircraft carriers, nuclear submarines or the latest missiles particularly when they are delivered late and usually over cost and affordability. And all parties agree that there can be no immediate reduction in the armed forces required in Afghanistan, Liam Fox is at when he cites this as the reason for exemption from cuts.

It may be that Dr Fox is smarter than he sounds. He must realise that the impact of the spending review on our communities and citizens will be far more apparent when care packages, benefits, new school building programmes, transport infrastructure, housing investment and basic services from libraries to refuse collection are all much reduced and the cost of public transport, pre school provision to university places are hiked.  He has possibly decided to make the first strike before the mood of the country changes.    We must hope that the PM makes an example of him for breaching cabinet responsibility, Dr Fox is a loose cannon.  At the same time the PM must think again about the devastation that will be caused by the cuts elsewhere, we are not Ireland.  It will not be long before the students, nurses, teachers, doctors, trade unions, civil servants, third sector and arts lobby join the fray when their ministers fail to go public in supporting them. And then we may see the coalition begin to wobble over its over enthusiasm for public spending cuts whilst the economy is still in free fall.

Generation Ed must raise its game and needs to put forward a robust argument for a more progressive spending review which does make a substantial reduction in debt but does not sacrifice jobs and the well being of people for tax concessions and weapons.

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