Are Public Spending Cuts Inevitable?
With the recession and economic downturn leaving Britain with a huge national debt and a general election looming, the political parties are looking at saving money and cutting costs. Both Labour and the Conservatives are talking about public spending cuts, albeit in different arenas.
Because the political leaders of both parties are both looking at cuts in public spending this would seem to be an inevitability that the Joe Public cannot avoid. There will be public spending cuts, if only because we cannot find a political party to vote for who both opposes cuts and has a realistic chance of taking government. The question which I focus on here is could it be avoided and, if so, should they be?
By the end of the year, the UK government has forecast that its debt will be £77bn. Early figures suggest that this might be a little low and the actual debt will exceed this. More importantly, the budget deficit, which is the amount by which that £77bn rises each month, is around £5bn.
So just to stop the debt levels rising, we need to find £5bn per month. As always with budgets, there are two options; tax more or spend less. £5bn is roughly equivalent to £85 per person, including children, the elderly and those on benefits, so finding this sort of money through taxes is by no means an easily achievable goal. Taxes may be part of the solution but is not a realistic package to pull us from the financial mire we find ourselves in. Finding even £1bn per year extra in taxes would be a huge strain on our businesses and the British people.
Other revenue streams might also help with this dilemma. Investment in education and infrastructure of our society is the ideal solution here, giving us more earning potential for the future. Unfortunately this would be a very long term solution and the debt is present now.
It would seem then, that some public spending cuts do have to be made. For better or for worse we cannot continue at this extreme level of spending which we find ourselves. Spending cuts do not have to mean service cuts however.
Government and government offices are inefficient and poorly managed with outdated budgeting plans and inherent redundancy. Perhaps it is time for a fresh look at how government and its divisions are run. We are a nation run ragged with red tape and bureaucracy wondering how we spend so much and achieve so little. Doctors, police and teachers, for example, all spend a huge amount of their time filing paperwork rather than helping the sick, keeping our streets safe or teaching our children. The same is true throughout civil service; huge amounts of time is wasted and replicated throughout our system.
Efficiency may be the solution the British government needs to consider most of all. We need to consider government offices as a whole and how they fill their role more effectively and efficiently. There are significant savings to be made, making a real difference to our budget deficit without significantly impeding on the services supplied.
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