Poll fears may blunt Tory leader's cutting edge

ANALYSIS:The Conservatives, after trumpeting the need to slash spending, are starting to wobble on an issue that is set to dominate Britain's general election

BRITISH PRIME minister Gordon Brown has long compared his judgment calls in office with those made from the opposition benches by Conservative leader David Cameron and his even more youthful shadow chancellor, George Osborne.

The Conservatives had been wrong, time and time again, on the banking crisis, he said, as he continued to hammer home the message that now is not the time for voters to risk inexperience.

The Conservatives’ leadership – despite some concerns from their backbenchers who doubted if the public would care for such straight-talking – declared ever more vocally that they would indeed cut public spending, and fast.

For months, Brown’s argument did not make any difference. Labour continued to languish in the polls, and political discourse centred on the scale of Labour’s defeat, rather than about its chances of victory.

With the onset of the election campaign in all but name, Cameron’s performance has come more under the spotlight, and he has stumbled on occasion, particularly over Tory plans to cut taxes for married couples.

In addition, he has been consistently outscored by Brown during recent prime minister’s questions, the weekly gladiatorial contest in the Commons by which MPs set such store.

A 1,000-strong billboard poster campaign centred on Cameron’s image has provoked little other than ridicule, particularly prompting tabloid stories about whether his photo was airbrushed, or not.

On spending, the Labour Party’s argument that, yes, spending must be cut – but not immediately, lest such action choke off nascent economic recovery – has begun to gain traction with the business community, and others.

In November, Cameron promised a budget within 50 days of being elected, which would be “about getting the deficit under control”. To be fair, he also promised a series of tax breaks to “get this economy moving again”. Labour’s “let’s do it all this in the future” smacked of arrogance, he then declared, warning that: “What you need is a plan to get the deficit down, you have got to demonstrate to people that you are serious by taking some steps in your first budget and you set out those steps.”

Now, opinion polls have narrowed to the point where two of them at the weekend put the Tories either seven, or nine points ahead: enough to make Cameron prime minister, but not enough to give him freedom to rule.

Faced with such darkening clouds, Cameron went to the World Economic Forum at Davos in Switzerland and, initially, repeated the mantra that spending must fall quickly, though by the end of the weekend his message had mellowed.

Spending must indeed fall, he said, but the cuts in the coming financial year, which begins in April, must not be swingeing. In essence, he accepted the core of Brown’s argument.

Faced with his leader’s action, Osborne talked about cutting government advertising and consultancy contracts, though he metaphorically has spent such savings already, since he said last December that cuts in both would be used to help freeze council tax rates for two years.

But he held to his top-line message: the United Kingdom, which has the largest borrowing figures of any of the world’s biggest economies, has to deal with its deficit, or else risk a Greek-style budget crisis where borrowers refuse to buy British government bonds, unless interest rates are put up to prohibitively high levels.

The issue is not so much about the money: everyone accepts the UK is entering “an age of austerity” if it is to have any chance of coping with a near-trillion pound national debt.

It is about timing, and it is about the public’s perception about the political judgment of those who will occupy No 10 and No 11 Downing Street once the election is out of the way in coming months.

Cameron and Osborne believed that the public was ready for “a dose of hard medicine”, as one Tory MP put it, but they also believed that the medicine could start to be poured in the coming year.

Now they are saying something different, presumably because Cameron feared that the way the debate had drifted threatened to reignite all of the British voters’ 20-year belief that the Tories cannot be trusted with public services.

He has risked losing the benefit of clarity, even if it brought with it political risk, for uncertain gains, particularly since the majority of the public rarely have the time, or the interest, to follow detail, but can recognise a retreat when they see one.

The Conservatives’ approach, before last weekend’s events, had the benefit of consistency and of allowing Cameron to portray himself as “Honest Dave” with voters, compared with Labour’s alleged duplicity.

Labour, on the other hand, is playing a shrewder hand: emphasising in broad terms that tough times lie ahead, offering guarantees to protect the most sensitive

parts of public spending, but not offering details about the cuts that will bite subsequently.

However, the current occupant of No 11, Alistair Darling, the chancellor of the exchequer, has already made it clear that some of the toughest spending cutbacks in 20 years are coming after April 2012.

Indeed, the figures are startling, and would effectively eliminate three-quarters of the public spending increases brought in by New Labour, firstly under Tony Blair and then Gordon Brown since 1997.

Statistics buried in the detail of Darling's Pre-Budget Reportlast December show that he plans a "fiscal tightening" from 2012 that would increase annually over the following six years to 6.4 per cent of national income – or £2,840 per family a year in today's terms.

This would be the tightest sustained squeeze on public spending in the United Kingdom since Labour’s Denis Healey was forced as chancellor to go to the International Monetary Fund for a bailout in the mid-1970s.

Mark Hennessy is London Editor