More than 100 Lib Dem Conference representatives have signed up to support amendments on the economy moved by SLF. As a show of support for a statement Party policy as opposed to opposition to a Government action, this is exceptional and possibly unprecedented.
SLF decided to table two separate amendments, one tailored to generating shorter-term economic growth this Parliament and the other looking to protect the distinctive and independent nature of Liberal Democrat economic policy into 2015 and beyond. (A third, drafting amendment has been submitted to bring the third pillar of our economic blueprint – banking reform – into line.) Thanks to all those Conference reps who signed their support for the amendments.
The issue of shorter-term economic growth should be dealt with by means of the most obvious win-win: housing. This is something that Japan has been doing as part of its strategy since 2010, with some success. It now seems that the Financial Times agrees, as Liberal Democrat blogger David Grace points out – taking a sideswipe at George Osborne’s latest wheeze and its effects on public debt. A more effective way to build the new homes we know we need is to kickstart social housing by removing the Treasury straitjacket on councils borrowing – which more than anything else since Right to Buy has stopped the building of council homes. More is needed including, in due course, looking at public land and the use of pension funds to drive this essential growth. There is no short-term problem regarding supply, with around 400,000 new homes estimated to already have planning permission. The Liberal Democrats’ target of 300,000 new homes a year would both tackle the housing crisis and create thousands of jobs in construction – a short-term economic stimulus with real long-term benefits.
Whereas last year’s debate was very much about the past, this time it is about the future. Specifically, a future Liberal Democrat agenda that is fit for purpose for the 2015 General Election and beyond. The motion ‘reaffirms’ support for the Coalition’s fiscal mandate, something it has not specifically affirmed before as the mandate was drawn up after the Coalition Agreement: it was not ‘affirmed’ in the 2012 debate, although definitely spun as such. What the motion does not do is signpost the independent economic strategy the Liberal Democrats will need to use in 2015, and in particular what variations to the fiscal mandate it would like to see. George Osborne has already said that the entire austerity programme should be based not on tax, but further eye-watering cuts to public spending until 2018. While Osborne would like to see the final £26 billion of savings in 2018 to come from cuts, the current version of the fiscal mandate is little better, with less than 20% to come from increased taxes. Labour will, we assume, set out its own stall. What is the Liberal Democrats’ stall to be, if it is not a positive social Liberal blueprint for the future, different from the compromises necessary of coalition with George Osborne – the Coalition position?
If the economy picks up on a consistent basis, tax receipts will rise and the deficit will fall. That is more likely to happen if long-term infrastructure investment in social housing – that will also help control the welfare budget – starts now in the way the Liberal Democrats have articulated before and which our amendment restates.
A Liberal Democrat view of the economy in 2015? The view articulated by Vince Cable drew significant support in 2010, driving the surge of support we saw in the early stages of that campaign. ‘There is no alternative’ might be a saying popular among the followers of Thatcher, but for those wishing to see a thriving, independent Liberal Democrat party in 2015 and beyond, there indeed is an alternative.