No tax rises ever? Say it ain’t so, Nick!

David Hall-Matthews’ speech on Motion “Growth that lasts: A fair, green and sustainable economy.”

Conference, I am speaking in favour of lines 22-23: “a fair and sustainable economy means delivering growth that lasts, through… honesty about the tough choices needed to cut the deficit and put the public finances back in order without damaging vital public services.”

I couldn’t agree more. This is at the heart of how will distinguish ourselves from Labour and the Conservatives during the election.

What I would ask for though, is a little more clarity and demonstration of honesty about what those tough choices will be.

First, how quickly will we try to reduce the deficit? Nobody is saying that we don’t have to take serious steps to address it. Of course we do. But we don’t need to prioritise it over our long term sustainability, services and welfare provision.

I’m an economic historian. If you take a long view, this crisis is not unprecedented, as some politicians will tell you. Britain has had acute public sector deficits before. So have most countries. So we can take a look at what strategies have been tried before and what has worked. The most effective governments have been those that have eased deficits down gradually while still investing in the economy. It does not work to cut and slash at the deficit and public services into the bargain.

Those of you who were at the Q&A with Nick Clegg yesterday will know that I asked him whether the Lib Dem strategy is to try and reduce the deficit within one parliament or, more responsibly, over two or even three. I didn’t get an answer then, so I’m asking again.

Second, we need to be clear that a sensible way to attack the deficit must be a full package of measures, not just cuts. We mustn’t rule out the option of tax rises.

There are a lot of journalists here today. I don’t think they’ve come to listen to me. They want to know what Nick will say in his speech. These journalists have been busy this week, haven’t they? One of them wrote that Nick had told them that he ruled out tax rises – that spending cuts were our only policy in relation to the deficit.

I gather that the official line on this is that he “misspoke” – which means he said it but he didn’t mean it. I appeal to you Nick: say it isn’t so!

It’s not too late. I’m sure the speech is already written. I’m not a journalist and certainly not one of Nick’s speechwriters, so I haven’t seen it. But those same journalists will be sitting in here in an hour or so, probably in the back row, with copies of the script on their laps. When Nick speaks, they’ll cross out every word in it that he doesn’t say, and add in anything he does say that isn’t there.

So please, Nick, give them something to write in: “Lib Dems don’t rule out future tax increases, because we will never do anything to harm vital public services.”

David Hall-Matthews is the Chair of the Social Liberal Forum.

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One comment on “No tax rises ever? Say it ain’t so, Nick!
  1. Yevgeny Primakovy says:

    Yes, but the problem with tax rises is that they take money out of the ‘productive’ areas of the economy – i.e., those areas that actually generate revenue, particularly foreign exchange revenue, and they replace this with what Labour calls ‘investment’ but which is actually spending. Vital public services need to be protected but we can’t just keep taking taxes whenever government overspends. This is a vicious circle and one which us LibDems need to avoid.

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