The Chancellor stood up in the House of Commons to deliver his Autumn Statement just after the deadline for this article. That meant I couldn’t write about it last week. But this week I think it’s worth looking at what the Chancellor said.
The economic forecasts are good. Britain is fortunate to have the most strongly performing economy in the advanced world.
We are growing more strongly than America or Japan, while our neighbours in the Eurozone are still flirting with recession. We have seen business creating nearly two million new jobs since 2010, and indeed hundreds of thousands of new businesses have been set up by entrepreneurial Brits. We are seeing a more balanced economy emerging, with manufacturing growing strongly, and the economy less dependent on the financial services industry.
But there’s much more to do. Yes, the deficit has been halved, as a proportion of the whole economy. But it’s still far too big. The state is still spending much more than it gets. Part of that is that tax revenues have grown less strongly than you would normally expect in an economy recovering from recession, although I recall that in the nineties tax receipts showed the same tendency to lag well behind the economic recovery.
But we need to do more, and especially we need to do more to reduce what Government spends. We can’t just carry on racking up debts that our children and grandchildren have to pay off. My part in the Autumn Statement was to publish a document setting out how we will continue our efficiency drive through the next five years. We’re on course to have saved £20 billion this year compared with Labour’s last year in government, 2009-2010, after saving £14.3 billion last year. We’ve achieved this through various means. The Civil Service is 18 per cent smaller, its smallest since World War II.
We’ve got out of loads of property we don’t need. We’re buying much better, and saving money through using the Government’s scale to drive down prices. We’ve moved from being a byword for IT disasters to being a world leader in digital government. This week I’m hosting the London Summit of the D5, a gathering of the world’s foremost digital nations.
But there’s much more we can and should do. We think we can save up to another £20 billion annually by 2019-2020. Yes - by doing some more of the same. But also by doing things very differently. Being genuinely digital by default, so that what can be done online is done only online, with assistance always available for those who aren’t digitally connected. And embracing different delivery models, especially the public service mutual where public servants spin out of the public sector to deliver their service under a contract.
I’ll perhaps say more about this groundbreaking movement next week.